Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Explain Net Present Value Method?
Net Present Value (NPV) Method: - This process measures the Present value of returns per rupee invested. In this method present value of Institute of IT & Management cash outflows and cash inflows is computed and the present value of cash outflow is subtracted from the present value of cash inflows. The difference is described as NPV.
NPV= PV of Inflow - PV of Outflow
OR
NPV = [(Cash inflow in 1st year x PVF 1) + (Cash inflow in 2nd year x PVF 2) + (Cash
inflow in 3rdyear x PVF 3) +-----------(Cash inflow in nth year XPVFn)] - [Initial cash outflow X PVF 0]
PVF1 = Present Value Factor in 1st year
PVF2 = Present value factor in 2nd year and so on.
If PVF is not given, we may calculate NPV as follows:
NPV = [Cash inflow in 1st year X 1/(1+r)1 ] + [Cash inflow in 2nd year X 1/(1+r) 2] +
[Cash inflow in 3rd year X 1/(1+r)3 ] +--------[Cash inflow in nth year X 1/(1+r)n ] - [Initial Cash outflow X 1/(1+r)0]
Accept-Reject Criteria:-
a) Suppose that the real risk-free rate, r*, is 3% and that inflation is assumed to be 7% in Year 1, 5% in Year 2, and 4% after that. Suppose also that all Treasury securities are
how to estimated
What factors does Standard & Poor’s analyze in determining the credit rating it assigns a sovereign government? Answer: In rating a sovereign government, Standard & Poor’s anal
Explain why accounting profits and cash flows are not the same thing. Ans: Stock value relies on future cash flows, their timing, and their riskiness. Profit calculations do n
Why do businesses spend time, effort, and money to produce forecasts? Explain. Businesses fail or succeed depending on how well prepared they are to deal with the situations t
what is the sensitivity analyses
Individual Project Due Date: Mon, 06/08/15 Points Possible: 100 Deliverable Length: 8-10 slides with speaker notes Description: You are the CFO of a 400-bed hospital in Texas
What are the Material items are carried out Material items would have an impact on: Audit tests carried out. For illustration compliance based testing (relying on contro
The Pennington Corporation issued a new series of bonds on January 1, 1979. The bonds were sold at par ($1,000), have a 12 percent coupon, and mature in 30 years, on December 31,
Memorandum Memo to: Blackwater plc Main Board. Subject: Proposed Pollution Control Project. From: Lower down the hierarchy. Date: That'll be the day. On purely non-
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd