1. ## Calculate the N.P.V

hi, how are u guys

don`t really know how to bit that
checked some posts before, but still nothing
can someone take a look pls

An investment costing 50 000 will generate year end returns of 7000 for 10 years. Calculate the N.P.V using a discount rate of 4 % per annum.

2. Originally Posted by kaluznikow
An investment costing 50 000 will generate year end returns of 7000 for 10 years. Calculate the N.P.V using a discount rate of 4 % per annum.
Please learn to use "Basic Principles". I beg you.

If $i = 0.04$, then $v = 1/(1+i) = 1/1.04$

$N.P.V. = -50000 + 7000(v + v^{2} + v^{3} + ... + v^{10}) = -50000 + 7000\left(\frac{v - v^{11}}{1-v}\right)$

You can simplify that a little more if you like.