Demirjian Inc

question 15

Multiple Choice

Demirjian Inc. is considering an investment project that would require an initial investment of $290,000 and that would last for 8 years. The annual cash receipts from the project would be $189,000 and the annual cash expenses would be $85,000. The equipment used in the project could be sold at the end of the project for a salvage value of $29,000. The company's tax rate is 30%. For tax purposes, the entire initial investment will be depreciated over 7 years without any reduction for salvage value. The company uses a discount rate of 13%.
-The net present value of the project is closest to:

• A) $121,972
• B) $114,339
• C) $59,367
• D) $67,000

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Definitions:

Revolutionary Military Strategies

Revolutionary military strategies are innovative and unconventional tactics employed during warfare, aimed at overcoming more powerful adversaries through guerrilla warfare, psychological operations, and leveraging terrain advantages.

Treaty of Paris

An agreement signed in 1783 that ended the American Revolutionary War and recognized American independence from Britain.

American Revolutionary

A participant or supporter in the American Revolution, fighting for independence from British rule during the late 18th century.

Revolutionary War

The conflict between Great Britain and its thirteen American colonies from 1775 to 1783 that resulted in the colonies gaining independence and forming the United States of America.