What’s the NPV when the initial investment is $500,000, cash inflow in year 1 is $200,000, cash inflow in year 2 is $200,000, cash inflow in year 3 is $200,000, cash inflow in year 4 is $200,000, cash inflow in year 5 is $200,000, cash inflow in year 6 is $200,000, cash inflow in year 7 is $200,000, and cash inflow in year 8 is $200,000? The required rate of return is 15%.

Required:

How to calculate manually?

what Excel formula  would use to calculate the NPV.

 What would be the IRR with the given data in Q4?

Answer rating: 100% (QA)

SOLUTION To calculate the NPV manually we can use the following formula NPV Initial Investment Cash Flow Year 1 1 Required Rate of Return1 Cash Flow Y... View the full answer