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
years0123456−60 00022 50019 00014 00022 00024 00013 000

A project costs €60 000 today and returns €22 500, €19 000, €14 000, €22 000, €24 000, €13 000 at the end of years 1 to 6. Assume cash flows arrive evenly through each year. Find the payback period PB in years.

CF0 = −60 000CF1 = 22 500CF2 = 19 000CF3 = 14 000CF4 = 22 000CF5 = 24 000CF6 = 13 000
PB = years
2.Easy
years0123? 20 00010 00012 000

A machine is expected to save €20 000, €10 000, €12 000 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.

r = 8%CF1 = 20 000CF2 = 10 000CF3 = 12 000
PV = €
3.Medium
years0123…10€50 000€4 000€4 000€4 000€4 000r = 5%, EAC = ?

A machine costs €50 000 today, lasts 10 years and costs €4 000 per year to run (paid at the end of each year). The cost of capital is 5%. Find its equivalent annual cost EAC.

C0 = €50 000M = €4 000n = 10r = 5%
EAC = €
4.Medium
years0123…9−400 00018 000+3%+3%…r = 8%, NPV = ?

A project costs €400 000 today. It generates €18 000 at the end of the first year, and the cash flow then grows by 3% per year forever. The cost of capital is 8%. Find the net present value NPV.

C0 = €400 000CF1 = €18 000g = 3%r = 8%
NPV = €
5.Hard
r (%)NPVABr* = ?0

Project A costs €40 000 and returns €22 000, €16 000, €9 500 at the end of years 1 to 3. Project B costs €45 000 and returns €11 500, €20 500, €23 000. Find the crossover rate r* at which both projects have the same NPV, in percent.

A: −40 000, 22 000, 16 000, 9 500B: −45 000, 11 500, 20 500, 23 000
r* = %
6.Hard
years0123…9−20 0003 5003 5003 5003 500

An investment of €20 000 returns €3 500 at the end of each year for 9 years. Find its internal rate of return IRR in percent.

C0 = €20 000CF = €3 500n = 9
IRR = %

Answer key

  1. 1. PB = 3.205 years
  2. 2. PV = 36618 €
  3. 3. EAC = 10475 €
  4. 4. NPV = −40000 €
  5. 5. r* = 7.477 %
  6. 6. IRR = 10.2 %

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