John Is Considering a Project with Cash Inflows of $1,100

question 114

Multiple Choice

John is considering a project with cash inflows of $1,100, $1,000, $1,050, and $1,200 over the next four years, respectively.The relevant discount rate is 12.5 percent.What is the net present value of this project if it the start-up cost is $3,200?

• A)$54.50
• B)$48.04
• C)-$35.45
• D)$89.33
• E)$122.00

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Definitions:

Psychological Risk

The potential for a purchase or consumption decision to lead to negative psychological outcomes, such as disappointment, regret, or a challenge to one's self-image.

Postpurchase Behavior

Postpurchase behavior involves the actions and reactions of consumers after buying and using a product, including levels of satisfaction, potential for repeat purchases, and the expression of feedback or complaints.

Actual Customers

Individuals who have made a purchase from a business, distinguishing them from potential customers who have not yet made a purchase.

Compensatory Consumers

Consumers who make purchasing decisions by weighing the strengths and weaknesses of different options.