The Orbison Company has analyzed an investment opportunity costing $250,000 and determinedthat the net present value is -$5,040. Petty's management estimated that the investment wouldhave equal annual net cash flows for four years, a salvage value of $20,000 after four years, and used adiscount rate of 14%. What was the annual net cash flow associated with the investment opportunity?Note: Present value tables are needed.
A) $56,240
B) $87,520
C) $83,120
D) $80,000
Correct Answer:
Verified
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