Table 11.6 A Corporation Is Assessing the Risk of Two Capital Budgeting

question 162

Multiple Choice

Table 11.6
A corporation is assessing the risk of two capital budgeting proposals.The financial analysts have developed pessimistic,most likely,and optimistic estimates of the annual cash inflows which are given in the following table.The firm's cost of capital is 10 percent.
-If the projects have five-year lives,the range of the net present value for Project B is approximately ________.(See Table 11.6)

• A)$80,563
• B)$201,000
• C)$255,444
• D)$303,263

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Definitions:

Lewis Line Structure

A diagram representing the valence electrons of atoms within a molecule using dots and lines for bonding pairs.

Line Structure

A simplified representation of a chemical structure, using lines to represent chemical bonds and showing the arrangement of atoms within the molecule.

Soluble

The property of a substance to be dissolved in a solvent, forming a homogeneous solution at a specified temperature and pressure.

Oxygen

A diatomic molecule that is a colorless, tasteless, and odorless gas essential for respiration in most living organisms.