What is the NPV of a project that costs $13,000 today and another $7,000 in one year, and is then expected to generate 11 annual cash inflows of $3,000 starting at the end of year 4. Cost of capital is 10%. Round to the nearest dollar.

What is the NPV of a project that costs $13,000 today and another $7,000 in one year, and is then expected to generate 11 annual cash inflows of $3,000 starting at the end of year 4. Cost of capital is 10%. Round to the nearest dollar.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 1P: A project has an initial cost of 40,000, expected net cash inflows of 9,000 per year for 7 years,...

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Question

What is the NPV of a project that costs $13,000 today
and another $7,000 in one year, and is then expected
to generate 11 annual cash inflows of $3,000 starting at
the end of year 4. Cost of capital is 10%. Round to the
nearest dollar.

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