A Proposed Project Costs $300 and Has Cash Flows of $80,$200,$75,and

question 17

Multiple Choice

A proposed project costs $300 and has cash flows of $80,$200,$75,and $90 for Years 1 to 4,respectively.Because of its high risk,the project has been assigned a discount rate of 16 percent.In dollars,how much will this project return in today's dollars for every $1 invested?

• A)$1.01
• B)$.99
• C)$1.05
• D)$.97
• E)$1.03

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Definitions:

Inflation Rate

The percentage increase in the price level of goods and services in an economy over a period of time, usually measured on a yearly basis.

Eisenhower Administration

The presidency of Dwight D. Eisenhower, the 34th president of the United States, from 1953 to 1961, known for its moderate political stance during the Cold War era.

Federal Government

The national government of a federation, which has specific powers accorded to it by a constitution, distinct from regional governments.

World War II Veterans

Individuals who served in the military during World War II, contributing significantly to the Allied victory.