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Accounting, Finance, SPSS
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Computation Using Excel Spreadsheet Discussion

Coursework Instructions:

Using Excel spreadsheet one can easily compute the NPV of a stream. Place the initial investment number in cell A1(using a negative, such as -1000 ), and then the cash flow that emanates from the investment in cells B1, C1 and so on (or you may chose to list the amounts vertically). Then use the NPV function to compute the NPV (be sure you place the rate and values in the correct place) . Consider the following example: Investment of 1000 (now), followed by net cash flow of 580 in one year and another 580 in two years. consider a cost of capital or a discount rate of 0.08 (8%). Use the Excel spreadsheet to compute the NPV of the investment. Then please use a simple calculator to do the same computation. Show your work. Do you get the same result? Are you sure? Tell me what you think of this little exercise.

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Computation Using Excel Spreadsheet Discussion
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Investment of 1000 (now), followed by net cash flow of 580 in one year and another 580 in two years. Consider a cost of capital or a discount rate of 0.08 (8%).
I entered the initial investment in cell B1 as a negative value. The net cash flows for two years was entered in cell B2 and B3 respectively while the discount rate was entered as 8 in cell B4. To compute the NPV I clicked the fx button and selected the net present value function. I then entered B4 as the rate, 580 as value 1 and 580 as value 2 and clicked okay. I then added the final answer to the initial investment, which gave 34.29 as the answer.
Then please use a simple calculator to do the same computation. Show your work.
I also calculated the same question manually using the ...
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