Compute the npv for all the cash flows


Assignment:

Outflows

Initial Investment now: $235,000

End of year:

1: $150,000
2: $200,000
3: $250,000
4: $300,000
5: $350,000

Inflows

Initial investment now: $---

End of Year:

1: $200,000
2: $250,000
3. $300,000
4: $450,000
5: $500,000

Question 1. Compute the NPV for all these cash flows. This should be a single amount. Use a discount rate of 14%.

Question 2. Suppose the minimum desired rate was 12%. Without doing further calculations, determine whether the NPV is positive or negative. Explain.

Solution Preview :

Prepared by a verified Expert
Finance Basics: Compute the npv for all the cash flows
Reference No:- TGS02035561

Now Priced at $25 (50% Discount)

Recommended (99%)

Rated (4.3/5)