What Happens to the NPV of a Two-Year Project If

question 11

Multiple Choice

What happens to the NPV of a two-year project if sales less costs are increased in each year from $1,000 to $1,500? Assume the firm has a 35% tax rate,and a 15% cost of capital.

• A) NPV increases by $812.85.
• B) NPV increases by $528.36.
• C) NPV increases by $500.00.
• D) NPV increases by $282.61.

---

Definitions:

Atomic Symbol

A one or two-letter notation representing a chemical element (e.g., O for oxygen, H for hydrogen).

Iron

Iron is a chemical element with the symbol Fe and atomic number 26; it is a metal in the first transition series and is by mass the most common element on Earth, forming much of Earth's outer and inner core.

Atomic Symbol

An abbreviation used to represent an element, based on its name in English or its Latin roots.

Strontium

A soft, silver-yellow, alkaline-earth metal with the symbol "Sr" and atomic number 38, used in fireworks and flares for its bright red coloration.