Exercise 13- 10 Basic Net Present Value Analysis

Kathy Myers frequently purchases stocks and bonds, but she is uncertain how to determine the rate of return that she is earning. For example three years ago she paid $13,000 for 200 shares of Malti company's common stock. She received a $420 cash divided on the stock at the end of each year for three years. At the end of three years, she sold the stock for $16,000. Kathy would like to earn a return for at least 14% on all of her investments. She is not sure weather the Malti Company stock provided a 14% return and would like some help with the necessary computations.

1. Using the net present value method, determine weather or not the Matli Company stock provided a 14% return. Round all computation to the nearest whole $.