A project's capital outlay is 2,500. It produces net cash inflows of 450, 3,000, 2,500 and

Question

A project's capital outlay is  2,500. It produces net cash inflows of  450,  3,000,  2,500 and

Accepted Answer

Step 1: Calculate the present value of each cash inflow
To calculate the present value of each c

A project's capital outlay is $$\$ 2,500$$. It produces net cash inflows of $$\$ 450$$, $$\$ 3,000$$, $$\$ 2,500$$ and $$\$ 300$$ in years $1,2,3$ and $4$ respectively. The discount rate is $8 \%$ per annum. What is the NPV? What is the IRR?