Solved

The Following Data Is Available for an Investment Object \bullet Acquisition Cost: 60,000

Question 20

Multiple Choice

The following data is available for an investment object: \bullet Acquisition cost: 60,000
\bullet Operating cash flows: 20,000 in year 1; 30,000 in year 2; 35,000 in year 3.
Using the NPV model with a discount rate of 10%, which of the following is true?


A) If the investment is realized, a positive NPV of approximately 9,300 can be achieved.
B) If the investment is realized, a negative NPV of approximately 9,300 can be achieved.
C) If the investment is realized, a negative NPV of approximately 25,000 can be achieved.
D) If the investment is realized, a positive NPV of approximately 25,000 can be achieved.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents