In: Finance
Project L requires an initial outlay at t = 0 of $35,000, its expected cash inflows are $13,000 per year for 9 years, and its WACC is 13%. What is the project's NPV? Do not round intermediate calculations. Round your answer to the nearest cent.
$
Ans $ 31711.52
Year | Project Cash Flows (i) | DF@ 13% | DF@ 13% (ii) | PV of Project ( (i) * (ii) ) |
0 | -35000 | 1 | 1 | (35,000.00) |
1 | 13000 | 1/((1+13%)^1) | 0.885 | 11,504.42 |
2 | 13000 | 1/((1+13%)^2) | 0.783 | 10,180.91 |
3 | 13000 | 1/((1+13%)^3) | 0.693 | 9,009.65 |
4 | 13000 | 1/((1+13%)^4) | 0.613 | 7,973.14 |
5 | 13000 | 1/((1+13%)^5) | 0.543 | 7,055.88 |
6 | 13000 | 1/((1+13%)^6) | 0.480 | 6,244.14 |
7 | 13000 | 1/((1+13%)^7) | 0.425 | 5,525.79 |
8 | 13000 | 1/((1+13%)^8) | 0.376 | 4,890.08 |
9 | 13000 | 1/((1+13%)^9) | 0.333 | 4,327.50 |
NPV | 31,711.52 |