Lester's Has a New Project with Projected Real Cash Flows

question 21

Multiple Choice

Lester's has a new project with projected real cash flows of $12,200,$14,600,and $16,300 for Years 1 to 3,respectively.The nominal discount rate is 15.96 percent and the inflation rate is 4 percent.What is the net present value of the project if the initial cost is $25,000?

• A)$9,711.64
• B)$8,946.48
• C)$9,508.70
• D)$9,444.15
• E)$9,248.74

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