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    Question

    A project costs ₹40 lakh and will generate ₹12 lakh

    p.a. for 6 years. The required rate of return is 10%. PV factor for 6 years @10% = 4.3553. Calculate NPV.
    A ₹12 lakh Correct Answer Incorrect Answer
    B ₹10 lakh Correct Answer Incorrect Answer
    C ₹12.26 lakh Correct Answer Incorrect Answer
    D ₹8 lakh Correct Answer Incorrect Answer
    E ₹14 lakh Correct Answer Incorrect Answer

    Solution

    • PV inflows = ₹12L × 4.3553 = ₹52.2636 lakh. • NPV = ₹52.26L – ₹40L = ₹12.26L.

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