Road Hawk Inc

question 107

Multiple Choice

Road Hawk Inc.is adding a new production line that will cost $720,000.The line will be depreciated on a straight- line basis over a 7-year period and will generate net cash flows of $160,000 in each of the 7 years.At the end of the project, it is expected the line can be sold as scrap for $10,000.If the firm's marginal tax rate is 40% and its required rate of return is 14 percent, what is the net present value of this project?

• A)$70,091
• B)-$27,920
• C)$64,091
• D)-$31,520

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Definitions:

Phospholipids

Phospholipids are a class of lipids forming the major component of all cell membranes, characterized by a hydrophilic head and two hydrophobic tails, providing vital barrier and structural functions.

Permeable

A characteristic of materials that allows liquids or gases to pass through them due to the presence of tiny holes or pores.

Proteoglycans

Large molecules composed of proteins and glycosaminoglycans that provide structural support in cellular matrices.

Extracellular Matrix

A complex network of proteins and carbohydrates outside the cell that provides structural and biochemical support to surrounding cells.