Suppose you have the following initial outlay and free cash flow information on a potential investment project where upper management requires a payback period of 4 or fewer years (i.e. required payback period = 3.99999 years) and that investors' Required Rate of Return is 15%.
Also, suppose that you will make project acceptance or rejection decisions for each problem independently of decisions made in other problems.
What is the Project's Net Present Value (NPV)?
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Period
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CF
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0
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-100,000
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1
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13,000
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2
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50,000
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3
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31,000
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4
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34,000
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5
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18,000
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6
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16,000
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7
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12,000
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