A project has estimated annual cash flows of $90,000 for three years and is estimated to cost $250,000. Assume a minimum acceptable rate of return of 10%. Using the following tables determine the (a) net present value of the project and (b) the present value index, rounded to two decimal places.
Below is a table for the present value of $1 at compound interest.
Definitions:
Factory Overhead
All the costs associated with operating a factory that are not directly tied to specific units of production, such as utilities, maintenance, and salaries of non-production staff.
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