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FMRelevant Cash flows for NPV calculation

HHussain11y ago
do we have to deduct interest payment on a loan taken to finance the investment when calculating NPV
John MoffatJohn MoffatTutor11y ago#1
No - it is taken account of when discounting (because the cost of the loan is included in the calculation of the cost of capital)
Aanna11y ago#2
Just wanted to ask: unfortunately i deducted the interest. And the final answer will be not correct. Exam stress. How then my answer will be marked ? "O or some marks will be awarded for working ( capital allowance, inflated sales, etc)?
John MoffatJohn MoffatTutor11y ago#3
You get marks for each part of the workings - the final answer gets hardly any marks.
Aanna11y ago#4
thank you!
John MoffatJohn MoffatTutor11y ago#5
You are welcome :-)
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