work out npv

[minister]

ok something like this
year1 -100 which is the cash outflow year 2 21 year3 21 year4 21 year5 21

The issue here is
Would i do this -100+ 21/(1+.1)^1+ 21/(1+.1)^2+ 21/(1+.1)^3+ 21/(1+.1)^4

or

-100+ 21/(1+.1)^2+ 21/(1+.1)^3+ 21/(1+.1)^4+ 21/(1+.1)^5
as i'm a bit confused the cash flow is under year 2 butcash outflow under year1

 

[killari]

Are your cashflows in advance or in arrears?

If they are in advance then your first calculation works, if they are in arrears you need to change the -100 in the second formula to -100/(1+0.1)