(Ignore income taxes in this problem.)Consider the following three investment opportunities:
Project I would require an immediate cash outlay of $40,000 and would result in cash savings of $9,000 each year for 5 years.
Project II would require cash outlays of $7,000 per year and would provide a cash inflow of $40,000 at the end of 5 years.
Project III would require a cash outlay of $36,000 now and would provide a cash inflow of $60,000 at the end of 5 years.
Required:
The discount rate is 10%.Use the net present value method to determine which,if any,of the three projects is acceptable.

Question

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The Answer of (Ignore income taxes in this problem.)Consider the following three investment opportunities:
Project I would require an immediate cash outlay of $40,000 and would result in cash savings of $9,000 each year for 5 years.
Project II would require cash outlays of $7,000 per year and would provide a cash inflow of $40,000 at the end of 5 years.
Project III would require a cash outlay of $36,000 now and would provide a cash inflow of $60,000 at the end of 5 years.
Required:
The discount rate is 10%.Use the net present value method to determine which,if any,of the three projects is acceptable.

(Ignore Income Taxes in This Problem