Desai Industries Is Analyzing an Average-Risk Project,and the Following Data

question 37

Multiple Choice

Desai Industries is analyzing an average-risk project,and the following data have been developed.Unit sales will be constant,but the sales price should increase with inflation.Fixed costs will also be constant,but variable costs should rise with inflation.The project should last for 3 years,it will be depreciated on a straight-line basis,and there will be no salvage value.No change in net operating working capital would be required.This is just one of many projects for the firm,so any losses on this project can be used to offset gains on other firm projects.What is the project's expected NPV? Do not round the intermediate calculations and round the final answer to the nearest whole number.

• A) 0$66,796
• B) 0$75,339
• C) 0$92,426
• D) 0$77,669
• E) 0$61,359

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Unbiased Coin

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Legal restrictions on the maximum speed at which vehicles may travel on a road.

Binomial Experiment

A statistical experiment that satisfies four conditions: a fixed number of trials, only two possible outcomes, independence of trials, and a constant probability of success.

Independent Trials

Experiments or trials in which the outcome of one trial does not affect the outcome of any other trials.