Finance

Finance

(Part 1)
Using a 4.4% discount rate, calculate the Net Present Value, Payback, Profitability Index and IRR for each of
the investment projects below (note, the inflows are for each year).

Project 1
Initial Invest= $505,000, Cash inflows of $105,000 for years 1-5 and $50,000 for years 6-10

Project 2
Initial Invest= $1,100,000, Cash inflows of $420,000 for years 1-3, $0 for years 4-7 and $250,000 for years 8-
10.

Project 3
Initial Invest= $840,000, Cash inflows of $300,000 for years 1-5, $0 for years 6-9 and $100,000 for year 10.

READ ALSO :   Electric Cars an Environmental Mistake