Precision Financial Calculator Precision Financial CalculatorContinue from Example 1-1. What if Mr. Thompson invests $50,000 at the year's end and receives revenues also at the end of the following years. Will NPV change? How about IRR, FV?
[Answer: IRR=10.14%; NPV=$8,318 vs. $8,636; FV=$10,033]
Example 1-1 has higher Net Present Value ($8,636), but IRR and FV remain unchanged.
Note that investment happens at the year's end. So you need to enter 0 to row
1.
[Procedures]
In the Cash Flow worksheet, type in 0, -50000, 10000, 15000, 20000, 20000 from row 1 to row 6. Click row 1, keep on pressing left mouse button, drag down until row 6. You will see the IRR=10.14%. Next, enter 3.82 in the Discount Rate box. You will get NPV and FV.