Answer:
$1,900.35
Explanation:
Net present value is the present value of after tax cash flows from an investment less the amount invested.
The npv can be calculated using a financial calculator:
Cash flow in year 0 = -$32,400
Cash flow in year 1 = $9720
Cash flow in year 2 = $9720
Cash flow in year 3 = $9720
Cash flow in year 4 = $ 4,860
Cash flow in year 5 = $ 4,860
Cash flow in year 6 = $2,430
I =7%
NPV = $1,900.35
To find the NPV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
