Use the Information for the Question(s)below

question 89

Multiple Choice

Use the information for the question(s) below.
Consider a project with free cash flows in one year of $90,000 in a weak economy or $117,000 in a strong economy,with each outcome being equally likely.The initial investment required for the project is $80,000,and the project's cost of capital is 15%.The risk-free interest rate is 5%.
-The NPV for this project is closest to:

• A)$6250.
• B)$14,100.
• C)$10,000.
• D)$18,600.

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Definitions:

Business Issues

Challenges and obstacles that affect the operation, growth, and survival of businesses.

Social Consequence

The impact of an action or decision on society, including effects on norms, behaviors, and the well-being of community members.

Social Purpose

Refers to the intention of an organization or initiative to contribute positively to society beyond the primary objective of making profit.

Social Entrepreneurs

Individuals who pursue innovative solutions to social problems with the aim to create social value and positive change.