Net present Value Example continued If the building is being offered for sale at a price of $350,000, would you buy the building and what is the added value generated by your purchase and management of the building? 16.00016000466.000 NPp=-350.000+ (107)(107)2(107)3 NP=$59,323 Irwin/McGraw-Hill CThe McGraw-Hill Commpanies, Inc, 2001©The McGraw-Hill Companies, Inc.,2001 6- 11 Irwin/McGraw-Hill Net Present Value Example - continued If the building is being offered for sale at a price of $350,000, would you buy the building and what is the added value generated by your purchase and management of the building? NPV NPV = − + + + = 350 000 1 6 000 1 0 7 1 6 000 1 0 7 466 000 1 0 7 323 1 2 3 , , ( . ) , ( . ) , ( . ) $59