Determine the net present value of the project

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Reference no: EM131240196

ASSIGNMENT

Use the following table in performing the subsequent Net Present Value (NPV) calculations:

Present Value of an Annuity of $1 at Compound Interest

Year

6%

10%

12%

15%

20%

1

0.943

0.909

0.893

0.87

0.833

2

1.833

1.736

1.69

1.626

1.528

3

2.673

2.487

2.402

2.283

2.106

4

3.465

3.17

3.037

2.855

2.589

5

4.212

3.791

3.605

3.353

2.991

6

4.917

4.355

4.111

3.785

3.326

7

5.582

4.868

4.564

4.16

3.605

8

6.21

5.335

4.968

4.487

3.837

9

6.802

5.759

5.328

4.772

4.031

10

7.36

6.145

5.65

5.019

4.192

1. A project has an estimated annual net cash flows of $6,800 for five years and is estimated to cost $23,125. Assume a minimum acceptable rate of return of 12%. Determine the net present value of the project.

2. A project has estimated annual net cash flows of $96,200 for four years and is estimated to cost $315,500. Assume a minimum acceptable rate of return of 10%. Determine the net present value of the project.

3. Buckeye Healthcare Corp. is proposing to spend $186,725 on an eight-year project that has estimated net cash flows of $35,000 for each of the eight years. Compute the net present value, using a rate of return of 12%.

Reference no: EM131240196

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