A project has the following cash flows: What is the project\'s NPV if the interest rate is $6%? 0 1 2 3 ($500) $100 $200 $310? Solution Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period) =100/1.06+200/1.06^2+310/1.06^3 =$532.62(Approx) NPV=Present value of inflows-Present value of outflows =$532.62-$500 =$32.62(Approx).