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Susanne invests $10,000 now and again towards the end of year 3. She gets a following return for 6 years.

Year

0

1

2

3

4

5

6

Cash Flow


2,000

2,000

4,000

5,000

5,000

5,000

Assume Discount rate is 6%, answer the following

A. What is the Net Present Value of these cash flows? Should Susanne make invest in this opportunity?

B. What is the future value of Net Cash Flow (end of year 6)

C. If Susanne had another opportunity where her NPV would be $1000. What is her opportunity cost?

Business Management, Management Studies

  • Category:- Business Management
  • Reference No.:- M91646389

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