Fitchminster Armored Car Can Purchase a New Vehicle for $200,000

question 66

Multiple Choice

Fitchminster Armored Car can purchase a new vehicle for $200,000 that will provide annual net cash flow over the next five years of $40,000,$45,000,$50,000,$55,000,and $60,000.The salvage value of the vehicle will be $25,000.Assume that the vehicle is sold at the end of year 5.Calculate the NPV of the armored car if the required rate of return is 9%.(Round your answer to the nearest $1. )

• A)$7,390
• B)$6,048
• C)$6,780
• D)$19,483

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