You are thinking of building a factory. The plant will cost € 100,000 and can be used for two years. The factory construction will increase your profits by € 55000 at the end of the first year and by € 60000 at the end of the second year. After the factory it will have no value. What is the net present value of the plant if the interest rate is 10%. Would you be willing to build the factory?

Answer rating: 100% (QA)

Heres how to calculate the Net Present Value NPV to decide whether building the factory is a good in... View the full answer