Project L costs $65,000, its expected cash inflows are $15,000 per year for 7 years, and Its WACC IS 13%

Finance Dec 21, 2020

Project L costs $65,000, its expected cash inflows are $15,000 per year for 7 years, and Its WACC IS 13%. What is the project's NPV? Do not round intermediate o calculations. Round your answer to the nearest cent.

Expert Solution

The project's NPV is calculated using the PV function as follows:

=PV(rate,nper,pmt)-intial investment

=PV(13%,7,-15000)-65000

=1339.16

Where,

rate is periodic rate of interest

nper is no of periods,

pmt is payment per period.

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