What Is the NPV of the Following Set of Cash

question 58

Multiple Choice

What is the NPV of the following set of cash flows at a discount rate of zero percent? What if the discount rate is 15 percent? $$\begin{array} { | c | r | } \hline \text { Year } & \text { Cash Flow } \\\hline 0 & - \$ 21,400 \\\hline 1 & 11,600 \\\hline 2 & 13,500 \\\hline 3 & 12,200 \\\hline\end{array}$$

• A)$0; -$665.07
• B)$0; $6,916.59
• C)$0; $7,208.19
• D)$15,900; $7,208.19
• E)$15,900; $6,916.59

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Definitions:

Null Hypothesis

A statistical hypothesis that assumes no significant difference or effect, serving as the default position to be tested against an alternative hypothesis.

Alternative Hypothesis

In hypothesis testing, the hypothesis that proposes a difference or relationship exists between two variables, as opposed to the null hypothesis.

Commute By Car

The act of traveling from home to work or another destination using a car.

Employee Commuting

The daily travel of employees between their places of residence and the workplace.