The table below shows actual cash flows of a project for XYZ LLC. If the real interest rate is 5% and inflation rate is 3%, calculate the Constant Dollar NPW for the project. Should the project be funded based on the NPW calculated? EOY Cash Flow -$60,000 1 $25,000 2 $23,000 3 $21,000

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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The table below shows actual cash flows of a project for XYZ LLC. If
the real interest rate is 5% and inflation rate is 3%, calculate the
Constant Dollar NPW for the project. Should the project be funded
based on the NPW calculated?
ΕΟΥ
Cash Flow
-$60,000
1
$25,000
2
$23,000
3
$21,000
Question 6 Part C: Provide the Constant Dollar NPW for this project.
Enter your answer in the form: 1234.56
Transcribed Image Text:The table below shows actual cash flows of a project for XYZ LLC. If the real interest rate is 5% and inflation rate is 3%, calculate the Constant Dollar NPW for the project. Should the project be funded based on the NPW calculated? ΕΟΥ Cash Flow -$60,000 1 $25,000 2 $23,000 3 $21,000 Question 6 Part C: Provide the Constant Dollar NPW for this project. Enter your answer in the form: 1234.56
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