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NPV Calculation

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JOYDIP DEY
Posts: 13
Joined: Sat Apr 01, 2017 8:08 am

NPV Calculation

Postby JOYDIP DEY Tue Aug 22, 2017 6:22 pm

Hi Friends,
Can anybody help me to solve this question. I am facing problem in translating month into year and Vise versa. The Question is "Calculate the net present value of a project which requires an initial investment of $243,000 and it is expected to generate a cash inflow of $50,000 each month for 12 months. Assume that the salvage value of the project is zero. The target rate of return is 12% per annum"?
VCAB
Participant
Participant
Posts: 71
Joined: Wed Dec 21, 2016 4:26 pm

Re: NPV Calculation

Postby VCAB Wed Aug 23, 2017 12:06 pm

Here is the formula... the administrators always advise that we attempt the question

PV= FV/(1+r)^n

PV= Present Value
FV= Future Value
r= discount rate
n= period
JOYDIP DEY
Posts: 13
Joined: Sat Apr 01, 2017 8:08 am

Re: NPV Calculation

Postby JOYDIP DEY Wed Aug 23, 2017 1:21 pm

Dear Friend,
This formula i also know. It is available everywhere. But if go to the question, we need to translate month into year. That is where the issue is. Can anybody elaborate how do i do that?

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