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 00011 50021 00022 50013 00012 50014 500

A project costs €60 000 today and returns €11 500, €21 000, €22 500, €13 000, €12 500, €14 500 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 = 11 500CF2 = 21 000CF3 = 22 500CF4 = 13 000CF5 = 12 500CF6 = 14 500
PB = years
2.Easy
years0123…8−20 0004 5004 5004 5004 500

A project costs €20 000 today and returns €4 500 at the end of each year for 8 years. The required rate of return is 8%. Find the profitability index PI.

C0 = €20 000CF = €4 500n = 8r = 8%
PI =
3.Medium
years012345−20 0004 5006 0008 0005 5004 000

A project costs €20 000 today and returns €4 500, €6 000, €8 000, €5 500, €4 000 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 = 4 500CF2 = 6 000CF3 = 8 000CF4 = 5 500CF5 = 4 000
DPB = years
4.Medium
years01234−60 00021 50021 50021 50021 500

A project costs €60 000 today and returns €21 500 at the end of each year for 4 years. 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 = −60 000CF1 = 21 500CF2 = 21 500CF3 = 21 500CF4 = 21 500
DPB = years
5.Hard
r (%)NPVABr* = ?0

Project A costs €30 000 and returns €17 500, €12 500, €7 000 at the end of years 1 to 3. Project B costs €35 000 and returns €9 500, €15 500, €19 000. Find the crossover rate r* at which both projects have the same NPV, in percent.

A: −30 000, 17 500, 12 500, 7 000B: −35 000, 9 500, 15 500, 19 000
r* = %
6.Hard
years012−10 0005 5007 500

A project costs €10 000 and returns €5 500, €7 500 at the end of years 1 to 2. Find its internal rate of return IRR in percent.

CF0 = −10 000CF1 = 5 500CF2 = 7 500
IRR = %

Answer key

  1. 1. PB = 3.385 years
  2. 2. PI = 1.293
  3. 3. DPB = 4.885 years
  4. 4. DPB = 3.612 years
  5. 5. r* = 6.762 %
  6. 6. IRR = 18.36 %

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