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
years0123−10 0005 0005 0005 000

A project costs €10 000 today and returns €5 000 at the end of each year for 3 years. The required rate of return is 12%. Find the net present value NPV.

r = 12%CF0 = −10 000CF1 = 5 000CF2 = 5 000CF3 = 5 000
NPV = €
2.Easy
years01234−25 0007 0007 0007 0007 000

A project costs €25 000 today and returns €7 000 at the end of each year for 4 years. The required rate of return is 12%. Find the profitability index PI.

C0 = €25 000CF = €7 000n = 4r = 12%
PI =
3.Medium
years0123−30 00011 0006 0009 000

An investment of €30 000 gives these cash flows at the end of years 1 to 3: €11 000, €6 000, €9 000. The cost of capital is 9%. Find the net present value NPV.

r = 9%CF0 = −30 000CF1 = 11 000CF2 = 6 000CF3 = 9 000
NPV = €
4.Medium
years0123…9−200 00022 000+2%+2%…r = 12%, NPV = ?

A project costs €200 000 today. It generates €22 000 at the end of the first year, and the cash flow then grows by 2% per year forever. The cost of capital is 12%. Find the net present value NPV.

C0 = €200 000CF1 = €22 000g = 2%r = 12%
NPV = €
5.Hard
r (%)NPVABr* = ?0

Project A costs €10 000 and returns €6 000, €4 000, €2 000 at the end of years 1 to 3. Project B costs €15 000 and returns €4 000, €6 500, €8 000. Find the crossover rate r* at which both projects have the same NPV, in percent.

A: −10 000, 6 000, 4 000, 2 000B: −15 000, 4 000, 6 500, 8 000
r* = %
6.Hard
r (%)NPVABr* = ?0

Project A costs €10 000 and returns €6 000, €4 000, €2 000 at the end of years 1 to 3. Project B costs €20 000 and returns €5 500, €8 500, €10 000. Find the crossover rate r* at which both projects have the same NPV, in percent.

A: −10 000, 6 000, 4 000, 2 000B: −20 000, 5 500, 8 500, 10 000
r* = %

Answer key

  1. 1. NPV = 2009 €
  2. 2. PI = 0.8505
  3. 3. NPV = −7909 €
  4. 4. NPV = 20000 €
  5. 5. r* = 8.354 %
  6. 6. r* = 6.975 %

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