Barang Inc. is considering investing in new excavation equipment for their mining business. The investment will require an outlay of $2,500,000 initially, and is expected to generate the following after-tax cash flows: Year 1, $800,000; Year 2, $1,000,000; Year 3, $500,000 (due to planned repairs); Year 4, $900,000; Year 5, $1,100,000 (including the disposal value). The company uses a discount rate of 13%.
What is the Net Present Value of the proposed investment? (Use a financial calculator or a financial spreadsheet to answer this question.)

Question

Barang Inc. is considering investing in new excavation equipment for their mining business. The investment will require an outlay of $2,500,000 initially, and is expected to generate the following after-tax cash flows: Year 1, $800,000; Year 2, $1,000,000; Year 3, $500,000 (due to planned repairs); Year 4, $900,000; Year 5, $1,100,000 (including the disposal value). The company uses a discount rate of 13%. 
What is the Net Present Value of the proposed investment? (Use a financial calculator or a financial spreadsheet to answer this question.)

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The Answer of Barang Inc. is considering investing in new excavation equipment for their mining business. The investment will require an outlay of $2,500,000 initially, and is expected to generate the following after-tax cash flows: Year 1, $800,000; Year 2, $1,000,000; Year 3, $500,000 (due to planned repairs); Year 4, $900,000; Year 5, $1,100,000 (including the disposal value). The company uses a discount rate of 13%. 
What is the Net Present Value of the proposed investment? (Use a financial calculator or a financial spreadsheet to answer this question.)