A project costing $6,200 initially should produce cash inflows
A project costing $6,200 initially should produce cash inflows of $2,860 a year for three years. After the three years, the project will be shut down and will be sold at the end of Year 4 for an estimated net cash amount of $3,300. What is the net present value of this project if the required rate of return is 11.3 percent?
$3,011.40
$2,903.19
$935.56
$2,474.76
$1,980.02
A proposed project costs $300 and has cash flows of $80, $200, $75, and $90 for Years 1 to 4, respectively. Because of its high risk, the project has been assigned a discount rate of 16 percent. In dollars, how much will this project return in today’s dollars for every $1 invested?
$.99
$1.05
$1.03
$1.01
$.97
What is the net present value of a project that has an initial cash outflow of $7,670 and cash inflows of $1,280 in Year 1, $6,980 in Year 3, and $2,750 in Year 4? The discount rate is 12.5 percent.
$371.02
$249.65
$86.87
$270.16
$68.20
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Solution: A project costing $6,200 initially should produce cash inflows