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Calculate value under net present value

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Reference no: EM132846600

If a purchase has a salvage value at the end how do you calculate its value under Net Present Value (NPV)?

  • Salvage or residual value is rarely considered in NPV calculations
  • The residual value will be discounted to the period in which it will be recieved in the future
  • It will be added to the total cost after being escalated for inflation
  • The value is what it was worth at the time of the purchase

Reference no: EM132846600

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