Expected cash flows for each investment each year


Question: Your company uses a 12% annual rate to discount cash flows for NPV. The following table presents the costs of each investment (negative values in time zero) and the expected cash flows for each investment each year.

Period    A    B    C
0   -500    -2000    -500
1    200       400     300
2    300       500     200
3    400       800     100
4    500       900       0
5    0         1000       0

1. Calculate the payback period for each investment.

2. Calculate the IRR for each investment.

3. Calculate the NPV for each investment.

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Finance Basics: Expected cash flows for each investment each year
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