BA II Plus| Cash Flows 2: (Capital Budgeting, NPV)
This brief video shows how to use the Texas Instruments BA II Plus calculator (CF) to compute NPV in order to make an investment decision.
Part 1: • BA II Plus | Cash Flows 1: Net Presen...
Problem:
Use NPV to choose betweeen project A and B
Project A: Invest $75,000 now, and receive $35,000 at the end of every year for 5 years plus an additional residual value (inflow) of $15,000 in year 5.
Project B: Invest $50,000 now and another $20,000 in year 1. Net returns are $80,000 in year 4 and $120,000 in year 5.
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