Suppose Your Firm Is Considering Investing in a Project with the Cash

question 69

Multiple Choice

Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistic for the project are three and three and a half years, respectively. $$\begin{array} { l l l l l l l } \text { Time } & 0 & 1 & 2 & 3 & 4 & 5 \\\text { Cash Flow } & - 100,000 & 30,000 & 45,000 & 55,000 & 30,000 & 10,000\end{array}$$ Use the NPV decision rule to evaluate this project; should it be accepted or rejected?

• A)$35,995.86, reject
• B)$38,875.53, accept
• C)$138,875.53, accept
• D)$238,875.53, accept

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Highly-Desirable

Attributes or qualities that are very attractive or sought-after, often used in the context of job competencies, living conditions, or product features.

Job Security

The likelihood that an individual will retain their job without the risk of becoming unemployed.

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Content that fulfills or exceeds the expectations and needs of the intended audience, often used in the context of media and digital marketing.

Wage Discrimination

The practice of paying employees differently for the same work based on gender, race, age, or other non-performance-related factors.