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    Question

    Initial Investment = ₹1,00,000; Cash inflow =

    ₹40,000 for 4 years; Discount rate = 10%. PV factor (4 yrs) = 3.169. Compute NPV.
    A ₹25,000 Correct Answer Incorrect Answer
    B ₹26,760 Correct Answer Incorrect Answer
    C ₹30,000 Correct Answer Incorrect Answer
    D ₹28,500 Correct Answer Incorrect Answer
    E ₹20,000 Correct Answer Incorrect Answer

    Solution

    PV of inflows = ₹40,000 × 3.169 = ₹1,26,760 NPV = ₹1,26,760 – ₹1,00,000 = ₹26,760.

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