Question

1-8 (similar to) Queaion Hau Related to Checkpoint 11.1 and Checkpoint 11.4) (NPV and IRR calculation) East Coast Tekrision is ooreidering a project with an intil outay of 5X tyou wil have to detemine ths arsourd it is aspacad hat the project wil produce a positive cash flow of $43,000 a year at the end of each year tor the next 16 years. The appropriate discount rate for this projact is 11 parcant If the project has an interal rade of etum of 18 peroent, what is the project's net present value? a If the project has an intamal nta of retum of 16 % , then the projocts inidal outay is S -317303.97 (Round to the nearest cont)

Answer 1

Initial Outlay can be calculating by taking present value of cash inflow at IRR,

Calculating Present Value,

PV = [FV = 0, PMT = -43,000, N = 15,I = 0.18]

PV = $218,937.84