A Project Initially Costs $40,500 and Will Not Produce Any

question 26

Multiple Choice

A project initially costs $40,500 and will not produce any cash flows for the first 2 years.Starting in Year 3,it will produce cash flows of $34,500 a year for 2 years.In Year 6,the project will end and should produce a final cash inflow of $12,000.What is the net present value of this project if the required rate of return is 18.5 percent?

• A)$2,474.76
• B)$2,063.19
• C)$1,935.56
• D)$1,865.95
• E)$2,647.76

---

Definitions:

Expert Power

The ability to influence others based on knowledge, experience, or skills.

Authority

The right or power to make decisions, give orders, and enforce obedience.

Rational Persuasion

A method of influencing others by using logical arguments and factual evidence to convince them of a point of view.

Coalition Building

The process of forming alliances among individuals, groups, or nations to achieve specific goals or address common issues.