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  • Calculating NPV Question

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    Vongayi Kuchekwa
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    This document presents a cost-benefit analysis of a project with an initial cost of $100,000 in year 0 and benefits of $80,000 in year 1, $100,000 in year 2, and $100,000 in year 3. Using a 10% discount rate, the net present value (NPV) is calculated as $0, with the return on investment (ROI) occurring in year 3 at 7.14% and the payback period in year 3.

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    NPV sample question

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    This document presents a cost-benefit analysis of a project with an initial cost of $100,000 in year 0 and benefits of $80,000 in year 1, $100,000 in year 2, and $100,000 in year 3. Using a 10% discount rate, the net present value (NPV) is calculated as $0, with the return on investment (ROI) occurring in year 3 at 7.14% and the payback period in year 3.

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    6 views2 pages

    Calculating NPV Question

    Uploaded by

    Vongayi Kuchekwa
    This document presents a cost-benefit analysis of a project with an initial cost of $100,000 in year 0 and benefits of $80,000 in year 1, $100,000 in year 2, and $100,000 in year 3. Using a 10% discount rate, the net present value (NPV) is calculated as $0, with the return on investment (ROI) occurring in year 3 at 7.14% and the payback period in year 3.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as xlsx, pdf, or txt
    of 2

    Discount Rate 10%

    Year 0 1 2 3 Totals

    Costs 100000 40000 50000 50000

    Discount Factor

    Discounted
    Costs 0 0 0 0 0

    Benefits 0 80000 100000 100000

    Discount Factor

    Discount
    Benefits 0 0 0 0 0

    Discount
    Benefits - Costs 0 0 0 0 0

    Cumulative
    Benefits -Costs

    ROI 7.14% Paybkk Year3


    NPV

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