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In the NPV calcs for the payback – the discount rate of 1 is used in year one and all the years are out of sync – is there a reason for this?
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HI,
Actually, the discount rate of 0.83 is used to calculate the PV of the year 1 periodic cash flow, not 1. The same applies to all other years … so the calculations are all CORRECT.
The reason, the “TAB button” on my keyboard!
Regards, Kevin Kelly
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