A Project Has an Initial Cost of £30m and the Opportunity

question 21

Multiple Choice

A project has an initial cost of £30m and the opportunity cost of capital is 10 per cent per year. There is an expected cash flow after year 1 of £8.8m. What is the NPV?

• A) - £22m
• B) +£39.68m
• C) - £20.32m
• D) - £24.2m

---

Definitions:

Permanent Predisposition

A long-lasting tendency or inclination to a particular condition or quality, often related to genetic or hereditary factors.

Diathesis-Stress Model

A psychological theory that explains behavior as both a result of biological and genetic factors ("diathesis") and life experiences ("stress").

Stress

A state of mental or emotional strain resulting from adverse or demanding circumstances, often affecting physical health.

Blood Pressure

The force exerted by circulating blood on the walls of blood vessels, crucial for diagnosing and monitoring cardiovascular health.