The NPV of that machine is $35.45. Here is an online financial 'Present Value of Cash Flows Calculator' to do it. Use the cash flows at the beginning of the period method. Enter the $5,000 initial investment as a negative number and for the last year add the $2,500 cash sale of the machine to the $300 cash flow that year for a total entry of $2,800 to line 6. You will also find a PV of cash flow chart showing what each entry of cash flow adds to the final value:

http://www.calculatorsoup.com/calculator...

Calculate the NPV of a machine which is bought for $5,000 and sold at the end of year 5 for $2,500. The machine produces the following cash flows in years 1 through 5 respectably: $700, $600, $500, $400, and $300. Also assume the cost of capital is 10%.