A machine is expected to save €25 000, €12 000, €5 000, €20 000 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 €10 000, €18 000, €20 000 at the end of years 1 to 3, after which it is worthless. The required return is 8%. What is the most the company should pay for the machine today? Find PV.
An investment of €75 000 gives these cash flows at the end of years 1 to 4: €20 000, €33 000, €19 000, €17 000. The cost of capital is 9%. Find the net present value NPV.
An investment of €30 000 gives these cash flows at the end of years 1 to 4: €15 000, €14 000, €15 000, €14 000. The cost of capital is 10%. Find the net present value NPV.
An investment of €25 000 returns €7 500 at the end of each year for 5 years. Find its internal rate of return IRR in percent.
A project costs €50 000 and returns €25 500, €20 000, €27 500 at the end of years 1 to 3. Find its internal rate of return IRR in percent.
Answer key
- 1. PV = 45536 €
- 2. PV = 40568 €
- 3. NPV = −2161 €
- 4. NPV = 16039 €
- 5. IRR = 15.24 %
- 6. IRR = 21.33 %
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