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
years0123…8−10 0002 5002 5002 5002 500

A project costs €10 000 today and returns €2 500 at the end of each year for 8 years. The required rate of return is 5%. Find the profitability index PI.

C0 = €10 000CF = €2 500n = 8r = 5%
PI =
2.Easy
years01234? 6 0006 00012 0006 000

A machine is expected to save €6 000, €6 000, €12 000, €6 000 at the end of years 1 to 4, after which it is worthless. The required return is 6%. What is the most the company should pay for the machine today? Find PV.

r = 6%CF1 = 6 000CF2 = 6 000CF3 = 12 000CF4 = 6 000
PV = €
3.Medium
years01234−75 00030 00024 00024 00036 000

An investment of €75 000 gives these cash flows at the end of years 1 to 4: €30 000, €24 000, €24 000, €36 000. The cost of capital is 5%. Find the net present value NPV.

r = 5%CF0 = −75 000CF1 = 30 000CF2 = 24 000CF3 = 24 000CF4 = 36 000
NPV = €
4.Medium
years0123456−50 00011 50016 00014 00022 50010 50021 000

A project costs €50 000 today and returns €11 500, €16 000, €14 000, €22 500, €10 500, €21 000 at the end of years 1 to 6. The cost of capital is 6%. Assume cash flows arrive evenly through each year. Find the discounted payback period DPB in years.

r = 6%CF0 = −50 000CF1 = 11 500CF2 = 16 000CF3 = 14 000CF4 = 22 500CF5 = 10 500CF6 = 21 000
DPB = years
5.Hard
r (%)NPVABr* = ?0

Project A costs €20 000 and returns €11 500, €8 000, €4 500 at the end of years 1 to 3. Project B costs €30 000 and returns €8 500, €11 500, €16 000. Find the crossover rate r* at which both projects have the same NPV, in percent.

A: −20 000, 11 500, 8 000, 4 500B: −30 000, 8 500, 11 500, 16 000
r* = %
6.Hard
years01234567−200 00028 500+2%+2%+2%+2%+2%+2%r = 10%, NPV = ?

A project costs €200 000 today. Its cash flow is €28 500 at the end of year 1 and grows by 2% per year until the last cash flow at the end of year 7. The cost of capital is 10%. Find the net present value NPV.

C0 = €200 000CF1 = €28 500g = 2%n = 7r = 10%
NPV = €

Answer key

  1. 1. PI = 1.616
  2. 2. PV = 25828 €
  3. 3. NPV = 25690 €
  4. 4. DPB = 3.738 years
  5. 5. r* = 5.806 %
  6. 6. NPV = −53744 €

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