A farmer invested Rs 10,000 in a new irrigation system. If the expected annual cash inflow from the system is Rs 2,500 for the next five years, and the discount rate is 8%, what is the NPV?
Answer: None of these
Explanation
To calculate the NPV, we use the formula:
NPV = Initial Investment + (Cash Inflows / (1 + Discount Rate)^Year) - (Initial Investment)
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