A project has an initial outlay of $1,522. The project will generate annual cash flows of...
A project has an initial outlay of $1,522. The project will generate annual cash flows of $485 over the 7-year life of the project and terminal cash flows of $314 in the last year of the project. If the required rate of return on the project is 13%, what is the net present value (NPV) of the project?
Homework Answers
Rate =13%
Number of years =7
NPV of the project =PV of cash flow +PV of Terminal cash flow
-Initial Outlay =485*((1-(1+13%)^-7)/13%)+314/(1+13%)^7-1522
=756.44
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