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  • NPV Irr Practice

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    Nazar Farid
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    This document contains a table showing the present value of $80,000 cash flows over 5 years using discount rates of 21%, 21.86%, and 0% to calculate the net present value. It also includes the formula for calculating the internal rate of return using interpolation between two discount rates where the net present values have opposite signs.

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    Net present value

    Original Title

    NPV IRR PRACTICE

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    This document contains a table showing the present value of $80,000 cash flows over 5 years using discount rates of 21%, 21.86%, and 0% to calculate the net present value. It also includes the formula for calculating the internal rate of return using interpolation between two discount rates where the net present values have opposite signs.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    5 views3 pages

    NPV Irr Practice

    Uploaded by

    Nazar Farid
    This document contains a table showing the present value of $80,000 cash flows over 5 years using discount rates of 21%, 21.86%, and 0% to calculate the net present value. It also includes the formula for calculating the internal rate of return using interpolation between two discount rates where the net present values have opposite signs.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    PRESENT VALUE PRACTICE

    1 2 (1) X (2)
    YEAR CF PVIF (21.00%) PV PVIF (21.86%) PV PVIF (0.00%) PV
    1 80000 0.826 66080 0.821 65680 1 80000
    2 80000 0.683 54640 0.673 53840
    3 80000 0.564 45120 0.553 44240
    4 80000 0.467 37360 0.453 36240
    5 0
    6 0
    7 0
    8 0
    9 0
    10 0
    PV OF CF 203200 200000
    SUM OF PV 2.54
    INITIAL INVESTMENT 200000
    NET PRESENT VALUE 3200 0

    INTERPOLATION FORMULA
    IRR
    A+ C/C-D*B-A A LOWER RATE
    B HIGHER RATE
    C NPV AT LOWER RATE
    D NPV AT HIGHER RATE
    21.00% 21.86% 0.00%
    20%

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