If a company has an interest rate of 13.42%. Compute the NPV for the following Cash...

Question

Question

If a company has an interest rate of 13.42%. Compute the NPV for the following Cash Flows:

business finance

Answer 1

Answer #1

Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period)

=93/1.1342+178/1.1342^2+50/1.1342^4

=250.58

NPV=Present value of inflows-Present value of outflows

=250.58-268

=-17.42(Approx)(Negative).

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Answer 2

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