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A project you are considering has an initial investment of $5,669.62. It has positive net cash...

A project you are considering has an initial investment of $5,669.62. It has positive net cash flows of $2,200 each year for three years. Your required rate of return is 10 percent. Calculate the net present value of this project. $ (show to 2 decimal places)

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Answer #1
Project
Discount rate 0.1
Year 0 1 2 3
Cash flow stream -5669.62 2200 2200 2200
Discounting factor 1 1.1 1.21 1.331
Discounted cash flows project -5669.62 2000 1818.182 1652.893
NPV = Sum of discounted cash flows
NPV Project = -198.55
Where
Discounting factor = (1 + discount rate)^(Corresponding period in years)
Discounted Cashflow= Cash flow stream/discounting factor
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