The Davis Corporation Is Considering an Investment in a Project

question 161

Multiple Choice

The Davis Corporation is considering an investment in a project that generates a profitability index of 1.3.The present value of the cash inflows on the project is $44,000.What is the net present value of this project?

• A)$10,154
• B)$13,200
• C)$57,200
• D)$33,846

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Definitions:

Deduction in Damages

A concept in legal disputes where the amount of compensation awarded is reduced due to certain factors, such as contributory negligence or mitigation of loss.

Delivery Expenses

Costs associated with the process of transporting goods from the seller to the purchaser.

Collective Intelligence

The shared or group intelligence that emerges from the collaboration, collective efforts, and competition of many individuals.

Distributed Leadership

A leadership approach where control and decision-making are shared among an expansive group of people, rather than centralized in a single leader.