Please show your work and how to do it on a financial calcul
Please show your work and how to do it on a financial calculator!
You have the following information on a project\'s cash flows. The cost of capital is 8.0%
Year
Cash flows
0
-$101,000
1
23,000
2
23,000
3
25,000
4
32,000
5
61,000
The NPV of the project is $____. Round to two decimal places.
| Year | Cash flows | 
| 0 | -$101,000 | 
| 1 | 23,000 | 
| 2 | 23,000 | 
| 3 | 25,000 | 
| 4 | 32,000 | 
| 5 | 61,000 | 
Solution
Calculation of NPV: Year Cash flows Discount factor Present Value a b c=1.08^-a d=b*c 0 $ -1,01,000 1.0000 $ -1,01,000.00 1 $ 23,000 0.9259 $ 21,296.30 2 $ 23,000 0.8573 $ 19,718.79 3 $ 25,000 0.7938 $ 19,845.81 4 $ 32,000 0.7350 $ 23,520.96 5 $ 61,000 0.6806 $ 41,515.58 NPV $ 24,897.43
