Compute the NPV statistic for Project X given the following cash flows if the appropriate cost of capital is 10 percent.
Project X
$$\begin{array} { c c c c c c }
\text { Timne } & 0 & 1 & 2 & 3 & 4 \
\text { Cash Flow } & - \$ 100,000 & - \$ 36,000 & \mathbf { \$ } 200,000 & \mathbf { \$ } 210,000 & - \$ 10,000
\end{array}$$
A) $183,507.96
B) $247,410.67
C) $248,962.50
D) $262,622.77

Question

Compute the NPV statistic for Project X given the following cash flows if the appropriate cost of capital is 10 percent.
Project X
$$\begin{array} { c c c c c c } 
\text { Timne } & 0 & 1 & 2 & 3 & 4 \
\text { Cash Flow } & - \$ 100,000 & - \$ 36,000 & \mathbf { \$ } 200,000 & \mathbf { \$ } 210,000 & - \$ 10,000
\end{array}$$
A) $183,507.96
B) $247,410.67
C) $248,962.50
D) $262,622.77

Quizplus · Accepted Answer

The NPV of Project X is $183,507.96. This is calculated by taking the present value of each cash flow and then summing them up. The present value of a cash flow is calculated by dividing the cash flow by (1 + r)^t, where r is the cost of capital and t is the time period. In this case, the cost of capital is 10% and the time periods are 0, 1, 2, 3, and 4. The present value of each cash flow is as follows:PV(0) = -$100,000PV(1) = -$36,000 / (1 + 0.10)^1 = -$32,727.27PV(2) = $200,000 / (1 + 0.10)^2 = $163,636.36PV(3) = $210,000 / (1 + 0.10)^3 = $172,759.46PV(4) = -$10,000 / (1 + 0.10)^4 = -$7,513.15The NPV is then calculated by summing up the present values of each cash flow:NPV = -$100,000 + -$32,727.27 + $163,636.36 + $172,759.46 + -$7,513.15 = $183,507.96

Compute the NPV Statistic for Project X Given the Following