The following present value factors are provided for use in this problem.

Periods | Present Value of $1 at 8% | Present Value of an Annuity of $1 at 8% |

1 | 0.9259 | 0.9259 |

2 | 0.8573 | 1.7833 |

3 | 0.7938 | 2.5771 |

4 | 0.7350 | 3.3121 |

Xavier Co. wants to purchase a machine for $38,000 with a four-year life and a $1,100 salvage value. Xavier requires an 8% return on investment. The expected year-end net cash flows are $13,000 in each of the four years.

What is the machine’s net present value?

Artie’s Soccer Ball Company is considering a project with the following cash flows:

Initial outlay | $750,000 |

Incremental after-tax cash flows from operations Years 1-4 | $250,000 per year |

Compute the NPV of this project if the company’s discount rate is 12%.

Your firm is considering a project that has the following set of cash flows. If the required rate of return for the project is 10%, find the net present value.

Year | Cash Flow |

0 | -$35,000 |

1 | 10,000 |

2 | 20,000 |

3 | 10,000 |

4 | 30,000 |

Fitch Minster Armored Car can purchase a new vehicle for $200,000 that will provide annual net cash flow over the next five years of $40,000, $45,000, $50,000, $55,000, and $60,000. The salvage value of the vehicle will be $25,000. Assume that the vehicle is sold at the end of year 5.

Calculate the NPV of the ambulance if the required rate of return is 9%.