Problem
Computing net present value. Gators, Inc. is considering a project that requires an initial investment of $2,000,000, and that will generate the following cash inflows for the next five years: (EXCEL)
Year Cash Inflow at End of Year
1 $300,000
2 400,000
3 800,000
4 800,000
5 600,000
Calculate the net present value of this project if Gator's cost of captial is:
a. 12 present
b. 20 present.