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NPV and Sensitivity Analysis

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The following is an extract from a 2015 advertisement by a pensions company seeking investments in a "managed fund".

annual discount rate 0.10
Initial invest -40,000.00
return - I yr 12,000.00
return - 2nd year 13,000.00
return - 3rd year 12,500.00
NPV ?

Set up a spreadsheet to calculate the NPV of the investment. Also perform sensitivity analysis for the following cases:
i) Vary the rate between 9% and 10%(in steps of 0.1)
ii) Vary the Initial investment between 25,000 and 50,000 ( in steps of 5000)
iii) Simultaneously varying both rate and initial investment (Two variable sensitivity analysis)

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Solution Summary

The solution here helps arrive at the NPV and also calculate NPV for different discount rates and investments

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