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3 years ago

The following data pertain to an investment proposal (Ignore income taxes.):

Business

1 answer:

Viefleur [7K]3 years ago

4 0

Answer:

The closest answer is option A,$7649

Explanation:

The net present value of the investment is the present value of annual cost savings minus the initial cost of investment.

present of cash flow=cash flow/(1+r)^n

r is the discount rate of 12%

n is the year the cash flow relates to ,for instance year zero for the initial investment

NPV=-$54,000+$16,000/(1+12%)^1+$16,000/(1+12%)^2+$16,000/(1+12%)^3+$16,000/(1+12%)^4+($16,000+$7,000)/(1+12%)^5=$ 7,648.41

note that the project gives $7,000 in salvage value in year 5

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2 years ago

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Answer:

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Answer:

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3 years ago

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Answer:

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