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Figure 10.9: NPV Profile For Multiple IRR Project

The document shows a graph of the net present value (NPV) profile for a project with multiple internal rates of return (IRR). The NPV decreases as the discount rate increases, crossing the x-axis at the IRR points of 6.6% and 36.55%. A table shows the project has initial costs of $1000 followed by positive cash flows of $800, $1000, and $1300 in subsequent years, then a final cost of $2200. It also lists the NPV at different discount rates from 0-50% and the two IRR points.

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Michael Johnson
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131 views

Figure 10.9: NPV Profile For Multiple IRR Project

The document shows a graph of the net present value (NPV) profile for a project with multiple internal rates of return (IRR). The NPV decreases as the discount rate increases, crossing the x-axis at the IRR points of 6.6% and 36.55%. A table shows the project has initial costs of $1000 followed by positive cash flows of $800, $1000, and $1300 in subsequent years, then a final cost of $2200. It also lists the NPV at different discount rates from 0-50% and the two IRR points.

Uploaded by

Michael Johnson
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLS, PDF, TXT or read online on Scribd
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PV Profile

Figure 10.9: NPV Profile for Multiple IRR Project


$80.00
$60.00
$40.00
$20.00

Internal Rates of
Return

NPV

$0.00
012345678911111111112222222222333333333344444444445
%%%%%%%%%%0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0
($20.00)
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
($40.00)
($60.00)
($80.00)
($100.00)
($120.00)
Discount Rate

Page 1

Project Cashflows

Multiple IRR: Project Cashflows


Year
0
1
2
3
4
IRR

Cash Flow
-1000
800
1000
1300
-2200
6.60%
36.55%

NPV Profile
Discount Rate
NPV
0%
($100.00)
1%
($80.01)
2%
($61.96)
3%
($45.69)
4%
($31.09)
5%
($18.02)
6%
($6.39)
7%
$3.92
8%
$13.00
9%
$20.93
10%
$27.80
11%
$33.68
12%
$38.65
13%
$42.78
14%
$46.11
15%
$48.71
16%
$50.63
17%
$51.93
18%
$52.64
19%
$52.80
20%
$52.47
21%
$51.67
22%
$50.44
23%
$48.81
24%
$46.82
25%
$44.48
26%
$41.83
27%
$38.89
28%
$35.68
29%
$32.22
30%
$28.54
31%
$24.64
32%
$20.56
33%
$16.30
34%
$11.88
35%
$7.31
36%
$2.61
37%
($2.21)
38%
($7.14)
39%
($12.17)
40%
($17.28)
41%
($22.48)
42%
($27.75)

Page 2

Project Cashflows
43%
44%
45%
46%
47%
48%
49%
50%

($33.09)
($38.47)
($43.91)
($49.39)
($54.90)
($60.45)
($66.02)
($71.60)

Page 3

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