Morgan, Inc

question 58

Multiple Choice

Morgan, Inc. is considering an eight-year project that has an initial after-tax outlay or after-tax cost of $180,000. The future after-tax cash inflows from its project for years 1 through 8 are the same at $35,000. Morgan uses the net present value method and has a discount rate of 12%. Will Morgan accept the project?

• A) Morgan accepts the project because the NPV is over $10,000.
• B) Morgan accepts the project because the NPV is about $6,141.
• C) Morgan rejects the project because the NPV is about -$6,133.
• D) Morgan rejects the project because the NPV is below -$7,000.

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Definitions:

Corporate Philosophy

The set of fundamental beliefs, values, and principles that serves as a foundation for the operating practices and ethical standards of a corporation.

Core Benefit Proposition

The fundamental value or advantage that a product or service offers to customers, serving as the primary reason for their interest or purchase.

Code of Ethics

A set of principles and standards designed to guide the conduct of members within an organization or profession.

Mission Statement

A brief declaration that defines an organization's purpose, goals, and approach to reach those goals, serving as a guide for its operations and strategies.