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    conduct a discounted cash flow calculation to determine NPV

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    A five-year project has a projected net cash flow of $15,000, $25,000, $30,000,
    $20,000, and $15,000 in the next five years. It will cost $50,000 to implement the
    project. If the required rate of return is 20 percent, conduct a discounted cash flow
    calculation to determine the NPV.

    Please explain using excel.

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    Solution Preview

    Hi there,

    The answer to your question is $10,746. Please see the attached Excel spreadsheet for the calculation. Also, for your reference, here is some information for you regarding the net present value and a discounted cash flow calculation.

    The Net Present Value (NPV) of an investment (project) is the difference between the sum of the discounted cash flows ...