Bpp revision kit question 165

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July 13, 2019 at 7:35 pm #522948
afiamirza
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I have watched the lectures on payback period but here the kit the answer is directly done as not much working
Look
Year 1. 2. 3. 4. 5.
PV. 9080. 9233. 9030. 9473
Cum NPV. 15920. 6687. 2343
Here I udstood how we got npv but how we cal the cum npv pls explain the cal of this number 15920 , 6687 and so on
I udst the concept but the calculation is done directly
I did like 9080 + 9233 = 18133 I didn’t get 15920 … ? Pls explain this sir
July 14, 2019 at 11:08 am #523007
John Moffat
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The initial investment is 25,000.
The NPV after 1 year is 9,080 – 25,000 = (15,920)
The NPV after 2 years is 9,233 + 9,080 – 25,000 = (6.687)
and so on.
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