NPV Example Example:Project with an initial cash outlay of S60,000 with following free cash flows for 5 years. Year FCF Year FCF Initial outlay -60,000 3 13,000 1 25,000 4 12,000 2 24,000 5 11,000 The firm has a 15%required rate of return(discount rate). SJTU ACEM Instructor:Tangzongming 2014 spring 11-8NPV Example  Example: Project with an initial cash outlay of $60,000 with following free cash flows for 5 years. Year FCF Year FCF Initial outlay –60,000 3 13,000 1 –25,000 4 12,000 2 –24,000 5 11,000  The firm has a 15% required rate of return(discount rate). SJTU ACEM Instructor:Tangzongming 2014 spring 11-8