Use the Following Table $\text { Present Value of an Annuity of } 1$

question 27

Multiple Choice

Use the following table, $\text { Present Value of an Annuity of } 1$
$\begin{array}{lrrr}\text { Period } & 8 \% & 9 \% & 10 \%\\1 & .926 & .917 & .909 \\2 & 1.783 & 1.759 & 1.736 \\3 & 2.577 & 2.531 & 2.487\end{array}$ A company has a minimum required rate of return of 9%. It is considering investing in a project which costs $350,000 and is expected to generate cash inflows of $140,000 at the end of each year for three years. The net present value of this project is

• A)$354,340.
• B)$70,000.
• C)$35,436.
• D)$4,340.

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Definitions:

Global Market

The international marketplace where goods, services, currencies, and information are exchanged across national boundaries.

Tariffs

Taxes on foreign products that discourage imports.

Dumping Activities

Practices where a country or company exports a product at a price lower than the price it normally charges in its own home market, often considered unfair competition.

Trade Surplus

A situation where the value of a country's exports exceeds the value of its imports over a specific period, indicating a positive balance of trade.