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Net Present Value: Park City

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A Park City corporation has cash flows as follows. What is the NPV?
Year 0 - ($1,000) r = 10%
Year 1 - $500
Year 2 - $400
Year 3 - $300
Year 4 - $100

a. 78.82 b. 85.16 c. 133.04 d. $168.45 e. Answer not listed

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Solution Summary

Net present value for Park City is examined.

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NPV= -$1000+$500/(1+.1)+$400/(1+.1)^2 +$300/(1+.1)^3 +$100/(1+.1)^4 ?78.82

So, to calculate net present value we calculate the discounted stream of future ...

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