Capstone Crowns Is Considering a Project That Will Produce Cash

question 35

Multiple Choice

Capstone Crowns is considering a project that will produce cash inflows of $11,000 in year one, $24,000 in year two, and $36,000 in year three. What is the present value of these cash inflows if the company assigns the project a discount rate of 14 percent?

• A) $40,331.89
• B) $46,564.28
• C) $52,415.32
• D) $54,868.15
• E) $60,978.35

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Definitions:

Directors

Members of a company's board responsible for making strategic decisions and ensuring the company's compliance with legal and ethical standards.

Business Decisions

The choices made by individuals or groups in regard to the operation, management, and strategy of a business.

Special Interest Group

An organization or group that advocates for specific issues or causes, often aiming to influence public policy or opinion.

Stakeholder

An individual or group that has an interest or concern in an organization or project, and whose input or involvement can affect or be affected by the outcome.