Project a Requires an Original Investment of $65,000

question 171

Essay

Project A requires an original investment of $65,000.The project will yield cash flows of $15,000 per year for 7 years.Project B has a calculated net present value of $5,500 over a 5-year life.Project A could be sold at the end of 5 years for a price of $30,000.a Using the table below, determine the net present value of Project A over a 5- year life with salvage value assuming a minimum rate of return of 12%.b Which project provides the greatest net present value?
Below is a table for the present value of $1 at compound interest.
Below is a table for the present value of an annuity of $1 at compound interest.

---

Definitions:

Datasheet

A representation of data in rows and columns, often used in software like databases and spreadsheets to organize and display information.

Field Value

The specific data or content entered into a particular field or cell in a database or spreadsheet.

Hyperlink

A reference or link in a document that users can click on to jump to another location or document within the same application or on the internet.

Data Type

A classification that specifies the kind of value a variable can hold, such as integer, string, or Boolean, and determines how the data can be used.