The adjustment that need to be made is <span>Value of the feature would be subtracted from the sales price of the comparable property in order to determine the worth of the property. without the features,
By doing this, we could determine the true market valuation of the property that being transacted.</span>
This answer requires that we fill in the blanks. The answers are contained in the bullet to fill the missing places
- shareholder wealth
- larger the NPV
- higher stock price.
- WACC
- accept the project.
- higher positive NPV.
<h3>What is the NPV?</h3>
This is the term that is used to refer to the net present value. This is the value that is calculated as the difference between the cash inflows and out flows for over a time period.
In order to get the NPV we have to make the following calculations for the projects A and B.
We have:
<u>For Project A</u>
-900 + 620/1.08 + 395/1.08² + 200/1.08³ + 250/1.08⁴
= $355. 237
<u> project B</u>
we would have
-900 + 620/1.08 + 395/1.08² + 200/1.08³ + 250/1.08⁴
= 378.98
The value for the project B happens to be greater than that of A hence this is the value that we have to accept
Read more on NPV here:
brainly.com/question/17185385
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