Assume the NPV of a Project Is $1

question 63

Multiple Choice

Assume the NPV of a project is $1.5 million.The project is expected to last five years.What is the equivalent annual benefit if the discount rate is 8%?

• A)$375,685
• B)$300,000
• C)$347,856
• D)$324,000

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Definitions:

Wage Rates

The amount of money paid per unit of time or output to an employee for labor.

Employment Decline

A reduction in the number of jobs or the rate of employment within an economy.

Economic Profit

The discrepancy between overall income and the sum of all expenses, covering both direct and indirect costs.

Profit-maximizing

The process or strategy of adjusting production and sales to achieve the highest possible profit levels under given conditions.