Q1 A project manager is using the net present value method to make the final decision on which project to undertake. The company has a 15% required rate of return and expects a 5% rate of inflation for the following four years. What is the NPV of a project that has cash flows of 50,000, 80,000, 100,000 and 150,000 for the first to fourth year respectively. The capital injection is 350,000. All figures are in Ringgit Malaysia (RM).

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Q1
A project manager is using the net present value method to make the final decision
on which project to undertake. The company has a 15% required rate of return and
expects a 5% rate of inflation for the following four years. What is the NPV of a
project that has cash flows of 50,000, 80,000, 100,000 and 150,000 for the first to
fourth year respectively. The capital injection is 350,000. All figures are in Ringgit
Malaysia (RM).
Transcribed Image Text:Q1 A project manager is using the net present value method to make the final decision on which project to undertake. The company has a 15% required rate of return and expects a 5% rate of inflation for the following four years. What is the NPV of a project that has cash flows of 50,000, 80,000, 100,000 and 150,000 for the first to fourth year respectively. The capital injection is 350,000. All figures are in Ringgit Malaysia (RM).
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