An Auto-Parts Company Is Deciding Whether to Sponsor a Racing

An auto-parts company is deciding whether to sponsor a racing team for a cost of $1 million. The sponsorship would last for three years and is expected to increase cash flows by $570,000 per year. If the discount rate is 6.9%, what will be the change in the value of the company if it chooses to go ahead with the sponsorship?

A) $498,597
B) $747,896
C) $797,756
D) $847,615