A project has an initial cost of $42,600, expected net cash inflows of $14,000 per year for 10 years, and a cost of capital of 9%. What is the project's NPV? (Hint: Begin by constructing a time line.) Do not round your intermediate calculations. Round your answer to the nearest cent. $
Present value of annuity=Annuity[1-(1+interest rate)^-time period]/rate
=14000[1-(1.09)^-10]/0.09
=14000*6.4176577
=89847.21
NPV=Present value of inflows-Present value of outflows
=89847.21-42,600
=$47247.21(Approx).
A project has an initial cost of $42,600, expected net cash inflows of $14,000 per year...
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