A machine is expected to save €6 000, €6 000, €18 000, €15 000 at the end of years 1 to 4, after which it is worthless. The required return is 15%. What is the most the company should pay for the machine today? Find PV.
NPV & IRR worksheet with answers
A machine is expected to save €8 000, €6 000, €8 000, €10 000 at the end of years 1 to 4, after which it is worthless. The required return is 9%. What is the most the company should pay for the machine today? Find PV.
An investment of €30 000 gives these cash flows at the end of years 1 to 4: €15 000, €9 000, €10 000, €8 000. The cost of capital is 9%. Find the net present value NPV.
An investment of €60 000 gives these cash flows at the end of years 1 to 4: €30 000, €13 000, €27 000, €15 000. The cost of capital is 9%. Find the net present value NPV.
A project costs €50 000 and returns €26 500, €22 000, €37 000 at the end of years 1 to 3. Find its internal rate of return IRR in percent.
A project costs €100 000 today. Its cash flow is €11 000 at the end of year 1 and grows by 2% per year until the last cash flow at the end of year 10. The cost of capital is 10%. Find the net present value NPV.
Answer key
- 1. PV = 30166 €
- 2. PV = 25651 €
- 3. NPV = 4726 €
- 4. NPV = 9940 €
- 5. IRR = 30.33 %
- 6. NPV = −27122 €
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