Question

Carland, Inc., has a project available with the following cash flows. If the required return for the project is 8.4 percent, what is the project's NPV? Cash Flow Year -$263,000 0 72,300 2 95,900 120,300 3 4 72,900 12,500 5 O H N M Ln

Answer 1

Year	Cash Inflow	Discount factor	Present value
a	b	c=1.084^-a	d=b*c
0	$       -2,63,000	1.0000	$ -2,63,000.00
1	72,300	0.9225	66,697.42
2	95,900	0.8510	81,613.13
3	1,20,300	0.7851	94,444.74
4	72,900	0.7242	52,797.14
5	-12,500	0.6681	-8,351.48
	NPV		$       24,200.95