2 A two-year project is being evaluated using a discount rate of 7% p.a. It is expected to have a cash inflow of £40,000 at the end of its first year and £60,000 at the end of its second year. What is the present value of the future cash flows if the discount factors are:

year 1: 0.935 and year 2: 0.873?

(a) £100,000

(b) £89,780

(c) £91,020

(d) £72,320