Purchase Solution

Net present value with an initial cash flow

Not what you're looking for?

Ask Custom Question

What is the net present value of a project that has an initial cash outflow of $12,670 and the following cash inflows? The required return is 11.5%.

Year Cash Inflows
1 $4,375
2 $0
3 $8,750
4 $4,100

a) $218.68
b) $370.16
c) $768.20
d) $1,249.65
e) $1,371.02

Purchase this Solution
Solution Summary

This solution provides the steps to calculate the net present value of a project.

Solution Preview

5. What is the net present value of a project that has an initial cash outflow of $12,670 ...

Purchase this Solution
Free BrainMass Quizzes
Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

Organizational Leadership Quiz

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

SWOT

This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.

Operations Management

This quiz tests a student's knowledge about Operations Management

View More Free Quizzes
Related BrainMass Solutions

  • Net present value and profitability index

    328932 Calculating net present value and profitability index Please help with the following solution with step by step calculations. Calculate the net present value and profitability index of an uneven cash flow.

  • NPV (Net Present Value) of a Project

    177721 NPV (Net Present Value) of a Project A project has an initial cost of $52,125, expected net cash inflows of $12,000 per year for 8 years, and a cost of capital of 12%. What is the project's NPV?

  • Calculating IRR and NPV

    Use a discount rate of 16% Why do you have a zero net present value? Annual Cash flow=$25000 Period=14 year Discount rate=16% Since cash flow is same throughout 14 years. It is equivalent to an ordinary annuity with R=$25000, n=14, i=16%.

  • Key financial metrics for this capital budgeting projectkey financial metrics for this capital budgeting project

    This is the discount rate of return for an investment proposal that equates the present value of initial cost of the investment with the present value of initial cost of investment with the present value of the expected net cash flows.

  • Net Present Value and Payback Period

    Present value of annual cash flow of $600.00 for 6 years is obtained by multiplying the annual cash flow by Present Value factor for an annuity PVIFA Annaul Cash flow= 600 n= 6 years r= 2% PVIFA (6 periods, 2.%

  • Payback period, net present value, annual rate of return

    net present value = NPV=initial investment + (present value of an annuity factor for 10 years at 9%) x (Annual Revenue-Cost) + (present value of a single sum factor for 10 years at 9%) present value of an annuity factor for

  • DCF and NPV method

    The net present value method (NPV) is one of the discounted cash flow methods in capital budgeting. NPV of an investment proposal is equal to the net present value of its annual after tax net cash flows less than the investment's initial outlay.

  • Investment Alternatives for Decisions

    with the highest value once its cash flows have been discounted into the present.

  • Capital Budgeting Technique Effects: NPV, IRR, & Simple Payback

    The present value of each of the cash flows was computed by multiplying the cash flow column with the present value column.

View More Related Solutions