how do i solve npv

toward short-term projects. If the NPV is positive, then the project should be accepted v ; if it is negative, then the project should be rejected v Let's look at a net present value example using the present value of an ordinary annuity table. The company has a project with a 5-year life that requires an initial investment of $200,000, and is expected to yield annual cash flows of $62,500. What is the net present value of the project if the required rate of return is set at 10%? Calculation Steps Present Value of an Annuity of $1 at Compound Interest. Net Present Value = ( $ 62,500 X ) - $ 200,000 Note: Round your answer to the nearest whole dollar. What NPV does the previous calculation yield? $ Based on the NPV computed above, what is indicated? 1. The project is profitable v 2. Yes v , the initial investment will be recovered