Table 24.1
The Net Present Value of Three Hypothetical Projects
Project
Dollars realized today
Dollars realized one year from today
Present value formula
Net present value given
r
= 0.10
A
$100
—
$100
$100.00
B
−$10
$115
−$10 + $115/(1 +
r
)
$94.55
C
$119
−$20
$119 − $20/(1 +
r
)
$100.82