Answer:
Explanation:
Using a financial calculator, input the following using CF function;
Initial Investment ; CF0 = -75,000
Yr1 cashflow ; C01 = 18,000
Yr2 cashflow ; C02 = 18,000
Yr3 cashflow ; C03 = 18,000
Yr4 cashflow ; C04= 18,000
Yr5 cashflow ; C05 = 18,000
Yr6 cashflow ; C06 = 18,000
Yr7 cashflow ; C07 = 18,000
Yr8 cashflow ; C08 = 18,000 +4,000 = 22,000
Required rate of return = 16%
then compute Net present value by keying in NPV, CPT = $4,404.74
