An investment that costs $40,000 will produce annual cash flows of $12,000 for a period of 4 years.Given a desired rate of return of 10%,what will the investment generate? (PV of $1 and PVA of $1) (Use appropriate factor(s) from the tables provided.Do not round your intermediate calculations.Round your answer to the nearest whole dollar.)
A) A positive net present value of $38,038.
B) A positive net present value of $1,962.
C) A negative net present value of $38,038.
D) A negative net present value of $1,962.
Correct Answer:
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