Net Present Value (NPV) Calculator Building Cash Flows 30| 0 30| 350 S0 $0 30 0 s0) $of 50 50 50 50 50 50 50 50 0 50) Initial Investment Annual Cash Inflows Discount Rate Year Number of Years Cash Flows Salvage Value Equipment Year 1 Cash Flows 50| np = Year [ 11 Cash Flows 50| Initial Investment Annual Cash Inflows Discount Rate Number of Years Salvage Value Initial Investment Annual Cash Inflows Discount Rate Year 1 2 3 4 5 6 7 8 9 10 Cash Flows $0 30 $0 S0 $0| S0 S0 $0| $0 50] Number of Years Principal Returned Equipment NPV Calculation: 1. Present Value of Annual Cash Flows: Annual Cash Flow: $4,000,000 per year Discount Rate: 12% . Number of Years: 15 Since there is no salvage value, you simply sum the discounted cash flows over 15 years. 2. NPV Formula: NPV = 15 4.000,000 2t=1 (1+0.12) -Initial Investment ($25,000,000)Bonds NPV Calculation: 1. Present Value of Annual Coupon Payments: . Coupon Payment: $2,400,000 per year for 10 years . Discount Rate: 9% 2. Present Value of Principal: Principal Returned: $30,000,000 at the end of 10 years 3. NPV Formula: NPV = \\ 10 2,400,000 30.000,000 =1 (1+0.09) + (1+0.09) 10 - Initial Investment ($28,500,000 if purchased at a discount, but could also be considered $30,000,000)