Which of the Following Amounts Is Closest to the Net

question 57

Multiple Choice

Which of the following amounts is closest to the net present value of a project that contributes $10,000 at the end of the first year and $5,000 at the end of the second year. The initial cost is $8,000 and the appropriate interest rate is 10%.

• A) $5,223
• B) $5,951
• C) $7,000
• D) $21,223
• E) $23,000