Alpha Company Is Considering an Investment of $1,000,000 in a Land

question 25

Multiple Choice

Alpha Company is considering an investment of $1,000,000 in a land development project. It will yield cash flows of $300,000 for 5 years. Alpha uses a discount rate of 7%. What is the net present value of the investment?

• A)$230,000
• B)$312,000
• C)$330,000
• D)$444,000

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Definitions:

Common Goals

Shared objectives or targets that a group or team collaborates to achieve, often motivating cooperation and collective effort.

Social Entities

Groups, organizations, or institutions composed of individuals that interact in complex ways and have a collective goal or identity.

Physical Capital

Tangible assets of a business that are used in the production process, such as machinery, buildings, and equipment.

Social Inventions

Innovations in the social realm that change or influence the way societies operate, interact, or govern themselves.