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 C h a p te r 0 5 N et P re s e n t V a lu e a n d O th e r In v e s tm e n t C r ite r ia

4 * 8 a N PV
A
=
5100 0 +
5 100 0
. 590 9 1
(1 1 0 )

N PV 5 10 0 0 $ 10 0 0 $4 0 0 0 $ 100 0 $ 10 0 0
g
= 52000 = .
+ $4 04 4 7 3
- + + -

(1 1 0 ) (1 1 0 y (1 1 o f (1 1 o y
5 ,

(1 1 o )

m e e ts B a n d C ha v e po s itiv e N P V s

P a yba ck - o n e
A ye a r
P a yb a ck - tw o
s y e a rs
P a yb a ck fo
c -
u r ye a rs

A a n d B

5 10 0 0

T h e p re s e n t v a lu e o f th e c a s h in fı
o w s fo r P r o je c t A n e v e r r e c o v e rs th e in itia l
o u u a y fo r th e p r o je c t w h ic h is a lw a y s th e c a s e fo r
,
a n e g a tiv e N P V p r o je c t

T h e p re s e n t v a lu e s o f th e c a s h in flo w s fo r P j
ro e c tB a re s ho w n in th e th ird
ro w o f th e ta b ı e b e lo w a n d th e c u m ,
u a ūv
ı e n e t p re se n tv a lu e s a re s h o w n

in th e fo u r th

C o
C 1 C 2 C 3 C 4 C 5

2 000 00 + 1 0 00 00
,
+ 1 00 0 0 0
,
+ 4 00 0 00
,
+ 1 000 00
,
+ 1 000 00
,
,

2 000 00 9 09 0 9 82 6 4 5 3 00 5 2 6
,
683 01 620 92
,

1 090 9 1
.
264 4 6 2 74 0 8 0
,
3 423 81
,
4 04 4 7 3
,

S in c e th e c u m u la tiv e N P V t urns p o s t v e b e tw
ii e e n ye a r 2 a n d ye a r 3 th e
,

d is
d is c o u n te d p a y b a c k p e rio
264 46
2 4 - L u a y c ￠1 ı>

3 005 26
,

fı
o f th e c a s h in o w s
fo r P ro je c t C a re s h o w n in th e th ird ro w o f
T h e p re s e n t w lu e s u e s a r e s h o w n in th e fo
a n d th e c u m u a
ıtiv e n e t p re s e n t v a ı u r th ro w
th e ta b le b e lo w ,
C2 Cj C4 C
C C 1 5
o

l 0 00 0 0 0 00 + 1 000 00 + 1 000 00
l 000 00 +
3 000 00
+ ,
,
, ,

,
90 9 09 826 45 0 00 683 0 1 6 20 92
3 00 0 0 0 58 1 45 39 47
,

2 090 9 1 1 264 46
,
1 2 64 4 6
,
,

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