NPV & IRR worksheet with answers

Free printable NPV & IRR worksheet: 6 problems from easy to exam level, with an answer key. Print it or save it as a PDF.

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Name: ____________________   Date: ____________

1.Easy
years01234−25 0008 0008 0008 0008 000

A project costs €25 000 today and returns €8 000 at the end of each year for 4 years. The required rate of return is 8%. Find the profitability index PI.

C0 = €25 000CF = €8 000n = 4r = 8%
PI =
2.Easy
years0123456−40 0009 0009 0009 0009 0009 0009 000

A project costs €40 000 today and returns €9 000 at the end of each year for 6 years. The required rate of return is 6%. Find the profitability index PI.

C0 = €40 000CF = €9 000n = 6r = 6%
PI =
3.Medium
years0123…8−100 00018 50018 50018 50033 500

A machine costs €100 000 today. It generates €18 500 at the end of each year for 8 years and can then be sold for €15 000. The cost of capital is 12%. Find the net present value NPV.

C0 = €100 000CF = €18 500S = €15 000n = 8r = 12%
NPV = €
4.Medium
years012345−40 00016 00014 00011 0009 50018 000

A project costs €40 000 today and returns €16 000, €14 000, €11 000, €9 500, €18 000 at the end of years 1 to 5. The cost of capital is 10%. Assume cash flows arrive evenly through each year. Find the discounted payback period DPB in years.

r = 10%CF0 = −40 000CF1 = 16 000CF2 = 14 000CF3 = 11 000CF4 = 9 500CF5 = 18 000
DPB = years
5.Hard
years0123−20 0007 5007 5007 500

An investment of €20 000 returns €7 500 at the end of each year for 3 years. Find its internal rate of return IRR in percent.

C0 = €20 000CF = €7 500n = 3
IRR = %
6.Hard
years0123−10 0007 0005 0006 000

A project costs €10 000 and returns €7 000, €5 000, €6 000 at the end of years 1 to 3. Find its internal rate of return IRR in percent.

CF0 = −10 000CF1 = 7 000CF2 = 5 000CF3 = 6 000
IRR = %

Answer key

  1. 1. PI = 1.06
  2. 2. PI = 1.106
  3. 3. NPV = −2040 €
  4. 4. DPB = 3.866 years
  5. 5. IRR = 6.129 %
  6. 6. IRR = 37.85 %

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