(Present Value Tables Are Needed - the Net Present Value of the Indiana Proposal Is

question 3

Multiple Choice

(Present value tables are needed.) Williams Department Stores is considering two possible expansion plans.One proposal involves opening 5 stores in Indiana at the cost of $1,800,000.Under the other proposal,the company would focus on Kentucky and open 6 stores at a cost of $2,400,000.The following information is available: $$\begin{array} { | l | l | l | } \hline & \text { Indiana proposal } & \text { Kentucky proposal } \\\hline \text { Required investment } & \$ 1,800,000 & \$ 2,400,000 \\\hline \text { Estimated life } & 10 \text { years } & 10 \text { years } \\\hline \text { Estimated residual value } & \$ 50,000 & \$ 80,000 \\\hline \begin{array} { l } \text { Estimated annual cash inflows over } \\\text { the next 10 years }\end{array} & \$ 400,000 & \$ 500,000 \\\hline \text { Required rate of return } & 10 \% &10\% \\\hline\end{array}$$
- The net present value of the Indiana proposal is closest to:

• A)$ 461,650.
• B)$ 658,000.
• C)$ 677,300.
• D)$1,291,800.

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Definitions:

Neuronal Pathway

Networks of neurons that transmit signals between different parts of the brain or from the brain to the rest of the body.

Divergent

Tending to be different or develop in different directions, or, in evolutionary terms, related organisms evolving different characteristics.

Acetylcholinesterase

An enzyme that catalyzes the breakdown of acetylcholine and some other choline esters that function as neurotransmitters.

Cholinergic Synapse

A synapse that uses acetylcholine as its neurotransmitter, facilitating communication between neurons in the nervous system.