Homework Answers
Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period)
=8000/1.14+8000/1.14^2+8000/1.14^3+8000/1.14^4+8000/1.14^5+8000/1.14^6
=31109.34
NPV=Present value of inflows-Present value of outflows
=31109.34-40,000
=$-8890.66(Approx)(Negative)
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