Investment analysis assignment 5
Using a 14% cost of capital, calculate the net present value for each of the independent
projects shown in the following table, and indicate whether each is acceptable.
Project A Project B Project C
Initial investment $500,000 $950,000 $50,000
year Cash inflows
1 $100,000 $230,000 $0
2 120,000 230,000 0
3 140,000 230,000 0
4 160,000 230,000 20,000
5 180,000 230,000 30,000
6 200,000 230,000 0
7 230,000 50,000
8 230,000 60,000
9 70,000
Using a 14% cost of capital, calculate the net present value for each of the independent
projects shown in the following table, and indicate whether each is acceptable.
Project A Project B Project C
Initial investment $500,000 $950,000 $50,000
year Cash inflows
1 $100,000 $230,000 $0
2 120,000 230,000 0
3 140,000 230,000 0
4 160,000 230,000 20,000
5 180,000 230,000 30,000
6 200,000 230,000 0
7 230,000 50,000
8 230,000 60,000
9 70,000