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Time

$
Cost of Capital
NPV
IRR
Payback

0
(35,000.00)
12%
(1,859.16)
10.95%
7 years

Time

Cash Flow
Cost of Capital
NPV
IRR
NPV
C

Time
Cash Flows
Reinvestment
Net CFs
PV of CF
Cost of Capital
NPV
IRR

4% perpetuity
20% perpetuity
50000
12%
15,000.00
15.43%
#VALUE!

Incremental Cash Flows


Project
Investment
1) Add a New Window
($75,000)
2) Update Existing Equipmen
-50,000
3) Build a New Stand
-125,000
4) Rent a Large Stand
-1,000
Discount rate
15%

3
25%
A

Investment cost
Subsidy pmt
0
-1000000

2 year payback
Discount rate
First 2 yrs CFs
PV of first 2 CFs
Subsidy pmt
C

0
-1,000,000
Discount rate
NPV
Subsidy pmt

0
-826101.72928664
0.243478
APR
Subsidy pmt

4
110,000
1,110,000

1
5,000.00

0
-35,000
12%
2,500.00

14
.
### . $ 5,000.00

1
4500 Perpetuity
1
2
-35000 $ 5,000.00 $ 5,000.00

12.86%
0.00E+00
0
-35,000

1
5000
1000
4000

Incremental Cash Flows


Year 1
Year 2

2
5200 perpetuity
1040 perpetuity
4160 perpetuity

Year 3

IRR

44,000
23,000
70,000
13,000

44,000
23,000
70,000
14,000

(122,101.18)
1,122,101.18

297391.2

237912.96

1
371,739

2
371,739

3
371,739

23,000
70,000
12,000

15
$ 5,000.00

NPV
11% ($3,468.81)
18%
$2,514.18
31% $34,825.76
1208% $28,469.88

190330.368 152264.2944 877898.8224

4
371,739

20%
743478
567,934.58
256,522.00
1
371,739
20%
($37,666.40)
$112,666.40
1
371,739

0.39998359
173898.270713

2
371,739

3
371,739

4
371,739

2
371,739

3
371,739

4
371,739

1)
2)
3)
4)

3
5,000.00

Time
Cash Flows
IRR = 25%
Two year payback
NPV = $75,000
ARR = 40%

4
###

$
$
$
$
$

0
(1,000,000.00)
(877,898.82)
(743,478.00)
(887,333.60)
(826,101.73)

5
###

1
371,739
371,739
371,739
371,739
371,739

6
###

2
###
###
###
###
###

7
###

3
371,739
371,739
371,739
371,739
371,739

8
###

4
###
###
###
###
###

25%

10
5,000.00

$
$
$
$
$

NPV
(37,666.40)
84,434.78
218,855.60
75,000.00
136,231.87

11
12
### $ 5,000.00 $

IRR
18.00%
25.00%
34.90%
24.40%
28.49%

Dst Rate
20%
20%
20%
20%
20%

13
5,000.00

Subsidy Pmt
$
$
$
$

122,101.18
256,522.00
112,666.40
173,898.27

14
###

15
###

Year
Time
Innitial Outlay
Revenue
Deposits
Production Cost
CFs
PV of CFs
Value
Innitial Outlay
Revenue
Deposits
Production Cost
CFs
PV of CFs
Value

1967
0
-100

1968
1
-200

1969
2
-200

1970
3
-200

1971
4
-200

140

140
-490
-100
-200
-200
-60
-550
$ (100.00) $ (181.82) $ (165.29) $ (45.08) $ (375.66) $
$ (584.05)
-100

-200

-200

-200
184

1972
5

420
140
-490
70
43.46

-200

184
-575
-100
-200
-200
-16
-591
$ (100.00) $ (181.82) $ (165.29) $ (12.02) $ (403.66) $
$ (311.15)

552
184
-575
161
99.97

1973
6

420
140
-490
70
39.51 $

552
184
-575
161
90.88 $

1974
7

420
140
-490
70
35.92 $

552
184
-575
161
82.62 $

1975
8

1976
9

1977
10

420
420
420
140
-490
-490
70
-70
420
32.66 $ (29.69) $ 161.93

552
184
-575
161
75.11 $

552

552

-575
-23
552
(9.75) $ 212.82

Output
Cost
Sales
Discount Ra

35
14
16
10%

Output
Cost
Sales
Discount Ra

46
12.5
16
10%

Project
3) Build a New Stand
4) Rent a Large Stand
Discount rate
Incremental 3-4

Incremental Cash Flows


Investment Year 1 Year 2
Year 3
IRR
-125,000 70,000
70,000
70,000
31%
-1,000 12,000
13,000
14,000
1208%
15%
-124,000 58,000
57,000
56,000
18%