Story Company is investing in a giant crane. It is expected to cost $6 million in initial investment, and it is expected to generate an end-of-year after-tax cash flow of $3 million each year for three years. Calculate the NPV at 12 percent.
A)$2.40 million
B)$1.20 million
C)$0.80 million
D)$0.20 million

Question

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The Answer of Story Company is investing in a giant crane. It is expected to cost $6 million in initial investment, and it is expected to generate an end-of-year after-tax cash flow of $3 million each year for three years. Calculate the NPV at 12 percent.
A)$2.40 million
B)$1.20 million
C)$0.80 million
D)$0.20 million

Story Company Is Investing in a Giant Crane