A Project Requires an Investment of $900 Today

question 31

Multiple Choice

A project requires an investment of $900 today.It can generate sales of $1,100 per year forever.Costs are $600 for the first year and will increase by 20% per year.(Assume all sales and costs occur at year-end,i.e.,costs are $600 @ t = 1.) Ignore taxes and calculate the NPV of the project at a 12% discount rate.

• A)$65.00
• B)$57.51
• C)$100.00
• D)Cannot be calculated as g > rNPV = -900 + (1,100 - 600)/1.12 + (1,100 - (600 × 1.2))/(1.12^2)+ (1,100 - 600 (1.2^2))/(1.12)^3 + (1,100 - 600 (1.2^3))/(1.12^4)= $57.51).

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Definitions:

CC

An abbreviation that can stand for "Chief Complaint" in medical contexts, referring to the primary issue or symptom reported by a patient.

Naproxen

A nonsteroidal anti-inflammatory drug (NSAID) commonly used to reduce pain, fever, inflammation, and stiffness.

POA Assignment

The designation of a Power of Attorney, which is the legal authority to make decisions on behalf of another person.

UHDDS

Uniform Hospital Discharge Data Set, a set of standards for collecting data on hospital inpatient stays.