A Project Is Expected to Create Operating Cash Flows of $68,300

question 199

Multiple Choice

A project is expected to create operating cash flows of $68,300 a year for 3 years. The initial cost of the fixed assets is $80,000. These assets will be worthless at the end of the project. An additional $6,000 of net working capital will be required throughout the life of the project. What is the project's net present value if the required rate of return is 14%?

• A) $72,567.47
• B) $73,408.18
• C) $76,617.30
• D) $78,567.47
• E) $79,200.03

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