Net present value method for a service company a$.$ Determine the expected annual net cash flows from the delivery truck investment for $20$Y$1-20$Y$5.$

Annual Net Cash Flow

dollar. If required, use the minus sign to indicate a negative net present value.

Present value of annual net cash flows

$

Investment

Net present value

$

c$.$ Is the additional truck a good investment based on your analysis?

$,$ because the net present value is

increase of $$4,000$ for each year thereafter. The annual operating costs for the truck are estimated to be $$3,000$ per year.

Present Value of $$1$ at Compound Interest

a$.$ Determine the expected annual net cash flows from the delivery truck investment for $20$Y$1-20$Y$5.$

Annual Net Cash Flow

dollar. If required, use the minus sign to indicate a negative net present value.

Present value of annual net cash flows

Investment