A project will require an initial outlay of $1000 and will result in the following cash inflows in the years shown. If the cost of capital is 4%, what is the NPV of the project? Year Cash Flow $770 $880

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A:

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A: Part 1:Payback Period = 2.5 yearsCalculation of Initial Investment:

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.