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do we have to deduct interest payment on a loan taken to finance the investment when calculating NPV
No – it is taken account of when discounting (because the cost of the loan is included in the calculation of the cost of capital)
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)?
You get marks for each part of the workings – the final answer gets hardly any marks.
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