Example Present Value Calculation
Computer lasts three years, costs $1700
Value of computer every year is a 2.5% improvement in productivity by employee whose salary + benefits = $50,000. Cost to operate is $500/year. Disposal cost is $200
PV = 750 + 728 + 707 - 200 -1700 = $285
This tells you that the computer is a good investment because the present value > 0