Question: A Project costs 60,000 and is expected to generate cash inflows as: Year Cash inflows( ) 1 10,000 2 12,000 3 15,000 4
A Project costs ₹ 60,000 and is expected to generate cash inflows as:
| Year | Cash inflows( ₹ ) |
| | |
| 1 | 10,000 |
| 2 | 12,000 |
| 3 | 15,000 |
| 4 | 18,000 |
| 5 | 20,000 |
| 6 | 22,000 |
Calculate Net Present Value and Profitability Index. Comment whether project should be accepted or not. Assume cost of capital is 10%. Enumerate the steps of calculation of NPV.
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