A Project Will Produce an Operating Cash Flow of $14,600

question 81

Multiple Choice

A project will produce an operating cash flow of $14,600 a year for 7 years.The initial fixed asset investment in the project will be $48,900.The net aftertax salvage value is estimated at $12,000 and will be received during the last year of the project's life.What is the net present value of the project if the required rate of return is 12 percent?

• A)$22,627.54
• B)$23,159.04
• C)$34,627.54
• D)$39,070.26
• E)$41,040.83

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Definitions:

Respondent

The party against whom a legal action is taken or who replies to a claim in a court process.

Expert Witness

A specialist in a particular field who is called upon to provide informed testimony in court cases to assist in reaching a decision.

Opinion Evidence

Testimony in court of what the witness thinks, believes, or infers in regard to facts in dispute, as distinct from personal knowledge of the facts themselves.

Hearsay Evidence

Statements made outside of court that are offered in court to prove the truth of the matter asserted, which are generally inadmissible unless they fall under an exception to the hearsay rule.