Use the Following Information to Answer the Question(s)below

question 57

Multiple Choice

Use the following information to answer the question(s) below.
Taggart Transcontinental is considering adding a trucking division to expand the coverage of its existing rail lines.The trucking division will cost $1,000,000 and is expected to generate free cash flows of $100,000 for each of the next five years.Taggart Transcontinental forecasts that future free cash flows after year 5 will grow at 2% per year,forever.Taggart Transcontinental's cost of capital is 10%.
-The NPV for the trucking division is closest to:

• A)$170,750.
• B)$200,000.
• C)$212,550.
• D)$250,000.
• E)$312,500.

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Definitions:

Electronic Communication

Refers to the transmission of information using electronic systems such as email, social media, and messaging apps.

Ambiguous Objectives

Goals or targets that are not clearly defined, making them open to multiple interpretations.

Verbal Communication

Communication that uses words; may be either oral or written.

Business Etiquette

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