Homework Answers
Calculation of Net Present Value
| Year | Particulars | Cashflow | Disc. Rate @ 6% | Discounted Cash flow |
| (A) | (B) | (C ) | (D) | (E ) = (C*D) |
| 0 | Cost of equipment | -4300000 | 1 | -4300000 |
| 1-20 | Annual Cash inflow | 838500 | 11.47 | 9617595 |
| Net Present Value (NPV) | 5317595 |
Therefore, Net present value of the investment proposal is 5317595
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