Number Crunching: Finding IRR and NPV with your HP 19BII

Question 1

What is the initial investment for buying the building?

Answer 1

$1 million

This is the starting cost before any cash flows are generated.

Question 2

How long do you anticipate holding the property?

Answer 2

Six years

This duration impacts the overall cash flow analysis.

Question 3

What is the anticipated cash flow for Year 1?

Answer 3

$99,300

This is the cash flow generated in the first year of holding the property.

Question 4

What is the anticipated cash flow for Year 2?

Answer 4

$120,300

This reflects an increase in cash flow compared to Year 1.

Question 5

What is the anticipated cash flow for Year 3?

Answer 5

$129,000

This shows continued growth in cash flow.

Question 6

What is the anticipated cash flow for Year 4?

Answer 6

$135,600

This indicates a steady increase in cash flow.

Question 7

What is the anticipated cash flow for Year 5?

Answer 7

$139,900

This demonstrates further growth in cash flow.

Question 8

What is the anticipated cash flow for Year 6?

Answer 8

$141,500

This is the highest cash flow expected during the holding period.

Question 9

What is the estimated selling price of the building after six years?

Answer 9

$1,250,000

This is the expected return from selling the property.

Question 10

What analysis will you study regarding cash flow?

Answer 10

Variation in cash flow

Understanding how cash flow variations affect decision making is crucial.

Question 11

Example scenario

Question 12

Keystrokes 1 of 2

Answer 12

Question 13

Keystrokes 2 of 2

Answer 13