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Finance: Net present value.

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What is the net present value of a lease that requires you to pay $10,000 at the beginning of each year for the next five years and includes a provision for a rebate of $5,000 at eh end of Year 5?

Discount Rate 7% Discount Factor 0.7629

What is the net present value of an item that has a purchase price of $20,000, requires $1,000 maintenance at the end of each year except year 4, and is expected to have a salvage value of $1,000 at the end of the 5 year useful life?

Discount Rate 7% Discount Factor 0.7629

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Solution Summary

The problem deals with determining the net present value of a stream of cash flows.

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Net Present Value

1.
What is the net present value of a lease that requires you to pay $10,000 at the beginning of each year for the next five years and includes a provision for a rebate of $5,000 at the end of Year 5? Discount rate 7%
Year Cashflow Discount rate Discount factor ...

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  • B. Sc., University of Nigeria
  • M. Sc., London South Bank University
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