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Sir,
I am confused at wht yr should i take as some NPV year star from 0 and some year 1 plz guide me on thisit depends on question, if you expect your returns to flow from year end take it end of year, if they are expected flow from beginning then you have to take it from beginning.
0, 1 etc are not years – they are points in time.
So time 0 is the start of the first year, and this is when we have the outflow of the cost of the machine.
We assume that operating flows (i.e. the revenue and the operating costs) occur at the end of the first year (unless you are told different in the question) and the end of the first year is 1 year away from the start and so they occur at time 1.(If you watch my lecture on this then it should make it clear to you.)
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