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 00018 0005 0006 000

A machine is expected to save €25 000, €18 000, €5 000, €6 000 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.

r = 15%CF1 = 25 000CF2 = 18 000CF3 = 5 000CF4 = 6 000
PV = €
2.Easy
years012345−80 00023 50026 00018 50019 00017 000

A project costs €80 000 today and returns €23 500, €26 000, €18 500, €19 000, €17 000 at the end of years 1 to 5. Assume cash flows arrive evenly through each year. Find the payback period PB in years.

CF0 = −80 000CF1 = 23 500CF2 = 26 000CF3 = 18 500CF4 = 19 000CF5 = 17 000
PB = years
3.Medium
years0123…9€20 000€2 000€2 000€2 000€2 000r = 5%, EAC = ?

A machine costs €20 000 today, lasts 9 years and costs €2 000 per year to run (paid at the end of each year). The cost of capital is 5%. Find its equivalent annual cost EAC.

C0 = €20 000M = €2 000n = 9r = 5%
EAC = €
4.Medium
years012345−20 0007 5008 5006 5007 5006 000

A project costs €20 000 today and returns €7 500, €8 500, €6 500, €7 500, €6 000 at the end of years 1 to 5. The cost of capital is 12%. Assume cash flows arrive evenly through each year. Find the discounted payback period DPB in years.

r = 12%CF0 = −20 000CF1 = 7 500CF2 = 8 500CF3 = 6 500CF4 = 7 500CF5 = 6 000
DPB = years
5.Hard
r (%)NPVABr* = ?0

Project A costs €10 000 and returns €6 000, €4 000, €2 500 at the end of years 1 to 3. Project B costs €12 000 and returns €3 000, €5 500, €6 500. Find the crossover rate r* at which both projects have the same NPV, in percent.

A: −10 000, 6 000, 4 000, 2 500B: −12 000, 3 000, 5 500, 6 500
r* = %
6.Hard
years012−20 00014 5008 500

A project costs €20 000 and returns €14 500, €8 500 at the end of years 1 to 2. Find its internal rate of return IRR in percent.

CF0 = −20 000CF1 = 14 500CF2 = 8 500
IRR = %

Answer key

  1. 1. PV = 42068 €
  2. 2. PB = 3.632 years
  3. 3. EAC = 4814 €
  4. 4. DPB = 3.399 years
  5. 5. r* = 4.58 %
  6. 6. IRR = 10.84 %

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