Question

In: Finance

Living Colour Co. has a project available with the following cash flows: Year Cash Flow 0...

Living Colour Co. has a project available with the following cash flows: Year Cash Flow 0 −$32,510 1 8,450 2 10,210 3 14,680 4 16,250 5 11,300 If the required return for the project is 9.5 percent, what is the project's NPV?

  • $28,380.00

  • $15,296.43

  • $14,499.75

  • $6,206.31

  • $13,384.38

Solutions

Expert Solution

Calculation of NPV
Year Cashflows PVF @9.5% Present value
0           -32,510.00 1           -32,510.00
1               8,450.00 0.913               7,716.89
2             10,210.00 0.834               8,515.25
3             14,680.00 0.762             11,181.08
4             16,250.00 0.696             11,303.08
5             11,300.00 0.635               7,178.07
NPV             13,384.38
So correct answer is $ 13384.38

jeff jeffy answered 2 years ago
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