Norton Company is considering a project that will require an initial investment of $750,000 and will return $200,000 each year for 5- years.
(a) If taxes are ignored and the required rate of return is 9%, what is the project's net present value?
(b) Based on this analysis, should Norton Company proceed with the project?
Below is a table for the present value of $1 at compound interest.
Below is a table for the present value of an annuity of $1 at compound interest.

Question

Norton Company is considering a project that will require an initial investment of $750,000 and will return $200,000 each year for 5- years.
(a) If taxes are ignored and the required rate of return is 9%, what is the project's net present value?
(b) Based on this analysis, should Norton Company proceed with the project? 
Below is a table for the present value of $1 at compound interest.  
Below is a table for the present value of an annuity of $1 at compound interest.

Quizplus · Accepted Answer

The Answer of Norton Company is considering a project that will require an initial investment of $750,000 and will return $200,000 each year for 5- years.
(a) If taxes are ignored and the required rate of return is 9%, what is the project's net present value?
(b) Based on this analysis, should Norton Company proceed with the project? 
Below is a table for the present value of $1 at compound interest.  
Below is a table for the present value of an annuity of $1 at compound interest.

Norton Company Is Considering a Project That Will Require an Initial