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# 1. A new machine will cost \$220,000 and generate after-tax cash inflows of \$30,000 for 10 years. Find the NPV if the firm uses a 10% opportunity cost...

1. A new machine will cost \$220,000 and generate after-tax cash inflows of \$30,000 for 10 years. Find the NPV if the firm uses a 10% opportunity cost of capital.What is the IRR? What is the payback period?

I started to solve and got stuck.. Please see my section in blue and what I have so far. I would like to see how i can know the IRR and payback period if possible.

Initial cost \$220,000

life of the project: 10 years

Annual cash flow: 30,000

required rate of return: 10%

Item

Years(s)

Amount of cash flow

20% factor

Present value of cash flow

annual cash inflow

1-10 years

30,000

initial investment

now

(220,000)

(220,000)

Net Present Value

NPV= (35650) IRR= 5.19%... View the full answer

1 comment
• NPV is -35650
• topwilfred
• Aug 06, 2018 at 2:42am

NPV -35662.99 IRR... View the full answer

The NPV of project is \$35,650. The... View the full answer

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