Frameworks,Inc

question 36

Multiple Choice

Frameworks,Inc.is considering a five-year project that has an initial after-tax outlay or after-tax cost of $80,000.The respective future cash inflows from its project for years 1,2,3,4 and 5 are: $15,000,$25,000,$35,000,$45,000 and $55,000.Frameworks uses the net present value method and has a discount rate of 9%.Will Frameworks accept the project?

• A)Frameworks accepts the project because the NPV is $129,455.25.
• B)Frameworks accepts the project because the NPV is 79,455.25.
• C)Frameworks accepts the project because the NPV is $49,455.25.
• D)Frameworks accepts the project because the NPV is less than zero.

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