A company. has a project available with the following cash flows: Year Cash Flow 0 −$32,630...

Question

Question

A company. has a project available with the following cash flows:

If the required return for the project is 9.3 percent, what is the project's NPV?

Multiple Choice

business finance

Answer 1

Answer #1

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

=12,990/1.093+14,740/1.093^2+20,640/1.093^3+11,840/1.093^4

=48326.11

NPV=Present value of inflows-Present value of outflows

=48326.11-32,630

=$15696.11(Approx).

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Answer 2

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