Project Bird-in-Hand will require an initial investment of $1.5 million and will result in a payment of $2 million from the client at the end of three years. If the required rate of return is 8%, what is the NPV for this project?
A) +$1,588,000
B) +$88,000
C) +$3,654,000
D) +$28,000
E) +$500,000

Question

Project Bird-in-Hand will require an initial investment of $1.5 million and will result in a payment of $2 million from the client at the end of three years. If the required rate of return is 8%, what is the NPV for this project? 
A) +$1,588,000
B) +$88,000
C) +$3,654,000
D) +$28,000
E) +$500,000

Quizplus · Accepted Answer

The Answer is B

Project Bird-In-Hand Will Require an Initial Investment of $1