Question

YEAR | CASH FLOWS |

0 | -50000 |

1 | 40000 |

2 | 40000 |

3 | 40000 |

4 | -40000 |

5 | 40000 |

6 | 40000 |

(NPV calculation) Calculate the NPV given the following free cash flows, above chart, if the appropriate required rate of return is 12 percent. Should the project be accepted?

What is the project's NPV?

Answer #1

Year
0
1
2
3
4
5
6
Cash Flow
-110000
30000
40000
20000
80000
20000
20000
Given the cash flows in the table above, calculate the payback
period assuming the cash flows in years 1 to 4 occur evenly
throughout the year. The required rate of return is 12%.
Answer in years accurate to two decimal places
Kindly please help to explain and answer.

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0
-$82,000
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1
34,000
0
2
34,000
0
3
34,000
108,000
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Year
Cash Flow
0
−$35,710
1
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2
9,410
3
13,280
4
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5
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Year
Cash Flow
0
$
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1
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2
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Year
Cash Flow
0
−$35,990
1
12,570
2
14,740
3
19,660
4
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Q. Consider the following table of cash flows
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8000
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