A Builder Is Planning to Construct to a Departmental Store

question 2

Multiple Choice

A builder is planning to construct to a departmental store with an investment worth $1,200.He receives proposals from two retailers interested to lease space in it assuring him future cash flows worth $1,000 at the end of the first year and $700 at the end of two years.If the building lasts only for two years and the discount rate is 15 percent, what would be the net present value of this project?

• A)$300.50
• B)$257.63
• C)$198.67
• D)$118.38

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Definitions:

Chorionic Villus Sampling

A prenatal test involving the collection of a small sample of the placental tissue to screen for genetic disorders in the fetus.

Amniocentesis

A prenatal diagnostic procedure in which a small sample of the amniotic fluid is extracted from the mother’s uterus and subject to genetic analysis.

Triple X Syndrome

Chromosomal disorder in which an individual is born with three X chromosomes; often unnoticed.

Klinefelter Syndrome

A genetic condition affecting males, characterized by an extra X chromosome, leading to symptoms such as reduced fertility and physical differences.