24.7 - Discounted Cash Flow (DCF) Analysis
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Practice Questions
Test your understanding with targeted questions
Define Discounted Cash Flow (DCF).
💡 Hint: What is the purpose of this method?
What does NPV stand for?
💡 Hint: It represents the value of money today versus future cash flows.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What does DCF stand for?
💡 Hint: Think about the method used for cash flow valuation.
True or False: A positive NPV means you should reject a project.
💡 Hint: Consider what a positive value means in context.
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Challenge Problems
Push your limits with advanced challenges
Consider an investment which requires an initial outlay of ₹50,000 and is expected to generate cash flows of ₹15,000 each year for 5 years. Calculate the NPV using a discount rate of 10%.
💡 Hint: Break down each cash flow and discount it to find the sum!
A project has a cost of ₹100,000 and expected cash inflows of ₹30,000 yearly for 4 years at a 12% discount rate. What is the NPV?
💡 Hint: Convert future values to present values to assess viability.
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