Use the table for the question(s)below.
Consider a project with the following cash flows:

-If the appropriate discount rate for this project is 15%,then the net present value (NPV)is closest to:
A)$6000
B)-$867
C)$1420
D)$867

Question

Use the table for the question(s)below.
Consider a project with the following cash flows:
 
-If the appropriate discount rate for this project is 15%,then the net present value (NPV)is closest to:
A)$6000 
B)-$867 
C)$1420 
D)$867

Quizplus · Accepted Answer

To calculate the NPV, we need to discount each cash flow to present value and then sum them up. Using a financial calculator or spreadsheet, we get an NPV of $1,420. Therefore, the best choice is C.

Use the Table for the Question(s)below