Compute the NPV statistic for Project Y if the appropriate cost of capital is 12 percent....

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Question

Compute the NPV statistic for Project Y if the appropriate cost of capital is 12 percent....

Compute the NPV statistic for Project Y if the appropriate cost of capital is 12 percent. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places.)

Project Y
Time:	0	1	2	3	4
Cash flow:	–$9,200	$3,590	$4,420	$1,760	$540

business finance

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Answer 1

Answer #1

Given for project Y

Time:	0	1	2	3	4
Cash flow:	–$9,200	$3,590	$4,420	$1,760	$540

Cost of capital = 12%

NPV is Sum of PV of all cash flows

So, NPV = -9200 + 3590/1.12 + 4420/1.12^2 + 1760/1.12^3 + 540/1.12^4 = $-875.13

So NPV for Project Y is $-875.13

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Answer 2

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