Question

What is the net present value of the following set of cash flows at a discount rate of 10 percent? Time Period Cash Flow 0 -$16,000 1 4,500 2 8,500 3 12,000 Group of answer choices $4,131 $2,783 $9,000

Answer 1

Year	Cash Flow	PV Factor	PV Of Cash Flow
a	b	c=1/1.10^a	d=b*c
0	$ -16,000	1	$         -16,000.00
1	$      4,500	0.9091	$             4,090.91
2	$      8,500	0.8264	$             7,024.79
3	$    12,000	0.7513	$             9,015.78
Net Present Value	$                   4,131