10 Assume that a company is considering a capital investment project with a four-year time horizon and the following cash flows: points Cost of new equipment Working capital required Annual net cash inflows Maintenance and repairs in third year Salvage value of equipment in fourth year $ 210,000 $ 50,000 $ 100,000 $ 40,000 $ 30,000 Skipped Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. eBook The working capital will be released at the end of the project and the company's required rate of return is 20%. The net present value of the project is closest to: Print Multiple Choice References O $24.100. $14,200. O $19,900). $40,100. O EXHIBIT 14B-1 Present Value of Sl: 1 (1+r) n 16% 22% 23% 0.467 0.314 0.351 0.444 Periods 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 40 4% 5% 6% 7% 0.962 0.952 0.943 0.935 0.925 0.907 0.890 0.873 0.889 0.864 0.840 0.816 0.855 0.823 0.792 0.763 0.822 0.784 0.747 0.713 0.790 0.746 0.705 0.666 0.760 0.711 0.665 0.623 0.731 0.677 0.627 0.582 0.703 0.6450.592 0.544 0.676 0.614 0.558 0.508 0.650 0.585 | 0.527 0.475 0.625 0.557 0.497 0.601 0.530 0.469 0.415 0.577 0.505 0.442 0.388 0.555 0.481 0.417 0.362 0.534 0.458 0.394 0.339 0.513 0.436 0.371 0.317 0.494 0.416 0.350 0.296 0.475 0.396 0.331 0.277 0.456 0.377 0.312 0.258 0.439 0.359 0.294 0.242 0.422 0.342 0.278 0.226 0.406 0.326 0.262 0.211 0.390 0.310 0.247 0.197 0.375 0.295 0.233 0.184 0.361 0.281 0.220 0.172 0.347 0.268 0.207 0.161 0.333 0.255 0.196 0.150 0.321 0.243 0.185 0.141 0.308 0.231 0.174 0.131 0.208 0.1420.097 0.067 8% 9% 10% 11% 12% 13% 14% 15% 17% 18% 19% 20% 21% 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.857 0.842 0.826 0.812 0.797 0.783 0.769 0.756 0.743 0.731 0.718 0.706 0.694 0.683 0.672 0.794 0.772 0.751 0.731 0.712 0.693 0.675 0.658 0.641 0.624 0.609 0.593 0.579 0.564 0.551 0.735 0.708 0.683 0.659 0.636 0.613 0.592 0.572 0.552 0.534 0.516 0.499 0.482 0.451 0.681 0.650 0.621 0.593 0.567 0.543 0.519 0.497 0.476 0.456 0.437 0.419 0.402 0.386 0.370 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.410 0.390 0.370 0.352 0.335 0.319 0.303 0.583 0.547 0.513 0.482 0.452 0.425 0.400 0.376 0.354 0.333 0.296 0.279 0.263 0.249 0.540 0.502 0.467 0.434 0.404 0.376 0.327 0.305 0.285 0.266 0.249 0.233 0.218 0.204 0.500 0.460 0.424 0.391 0.361 0.333 0.308 0.284 0.263 0.243 0.225 0.209 0.194 0.180 0.167 0.463 0.422 0.386 0.352 0.322 0.295 0.270 0.247 0.227 0.208 0.191 0.176 0.162 0.149 0.137 0.429 0.388 0.350 0.317 0.287 0.261 0.237 0.215 0.195 0.178 0.162 0.148 0.135 0.123 0.112 0.397 0.356 0.319 0.286 0.257 0.231 0.208 0.187 0.168 0.152 0.137 0.124 0.112 0.102 0.092 0.368 0.326 0.290 0.258 0.229 0.204 0.182 0.163 0.145 0.130 0.116 0.104 0.093 0.084 0.075 0.340 0.299 0.263 0.232 0.205 0.181 0.160 0.141 0.125 0.111 0.099 0.088 0.078 0.069 0.062 0.315 0.275 0.239 0.209 0.183 0.160 0.140 0.123 0.108 0.095 0.084 0.074 | 0.065 0.057 0.051 0.292 0.252 0.218 0.188 0.141 0.123 0.107 0.093 0.081 0.071 0.062 0.054 0.047 0.042 0.270 0.231 0.198 0.170 0.146 0.125 0.108 0.093 0.080 0.069 0.060 | 0.052 0.045 0.039 0.034 0.250 0.212 0.180 0.153 0.130 0.111 0.095 0.081 0.069 0.059 0.051 0.044 0.038 0.032 0.028 0.232 0.194 0.164 | 0.138 0.116 0.098 0.083 0.070 0.060 0.051 0.043 0.037 0.031 0.027 0.023 0.215 0.178 0.149 0.124 0.104 | 0.087 0.073 0.061 0.051 0.043 0.037 0.031 0.026 0.022 0.019 0.199 0.164 0.135 0.112 0.093 0.077 0.064 0.053 0.044 0.037 0.031 0.026 0.022 0.018 0.184 0.150 0.123 0.101 0.083 0.068 0.056 0.046 0.038 0.032 0.026 0.022 0.0180.015 0.013 0.170 0.138 0.112 0.091 0.074 0.060 0.049 0.040 0.033 0.027 0.022 0.018 0.015 0.012 0.010 0.158 0.126 0.1020.082 0.066 0.053 0.043 0.035 0.028 0.023 0.019 0.015 0.013 0.010 0.008 0.146 0.116 0.092 0.074 0.059 0.047 0.038 0.030 0.024 0.0200.016 0.013 0.010 0.00 0.007 0.135 0.106 0.084 0.066 0.053 0.042 0.033 0.026 0.021 0.017 0.014 0.011 0.009 0.007 0.006 0.125 0.098 0.076 0.060 0.047 | 0.037 0.029 0.023 0.018 0.014 0.011 | 0.009 0.007 0.006 0.005 0.116 0.090 0.069 0.054 0.042 0.033 0.026 0.020 0.0160.0120.010 0.008 0.006 0.005 0.004 0.107 0.082 0.063 0.048 0.037 0.029 0.022 0.017 0.014 0.011 0.008 0.006 0.005 0.0040.003 0.099 0.075 0.057 0.044 0.033 0.026 0.020 0.015 0.012 0.009 0.007 0.005 0.004 0.003 0.003 0.046 0.032 0.022 0.015 0.0110.008 0.005 0.004 0.003 0.002 0.001 0.001 0.001 0.000 0.000 24% 25% 0.813 0.806 | 0.800 0.661 0.650 0.640 0.537 0.524 0.512 0.437 0.423 0.410 0.355 0.341 0.328 0.2890.275 0.262 0.235 0.222 0.210 0.191 0.179 0.168 0.155 0.144 0.134 0.126 0.116 0.107 0.103 0.094 0.086 0.083 0.076 0.069 0.068 0.061 0.055 0.055 0.049 0.044 0.045 0.040 0.035 0.036 0.032 0.028 0.030 0.026 0.023 0.024 0.021 0.018 0.020 0.017 0.014 0.0160.014 0.012 0.013 0.011 0.009 0.011 0.009 0.007 0.009 0.007 0.006 0.007 0.006 0.005 0.006 0.005 0.004 0.005 0.004 0.003 0.004 0.003 0.002 0.003 0.002 0.002 0.002 0.002 0.002 0.002 0.002 0.001 0.000 0.000 0.000 0.163 0.015 EXHIBIT 14B-2 Present Value of an Annuity of $1 in Arrears: 11[1-1(1+r)n] 16% Periods 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 40 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 17% 18% 19% 20% 21% 22% 23% 24% 25% 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 1.886 1.859 1.833 1.808 1.783 | 1.759 1.736 1.713 1.690 1.668 1.647 1.626 1.605 1.585 | 1.566 1.547 | 1.528 1.509 | 1.492 1.474 | 1.457 | 1.440 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.444 2.402 2.361 2.322 2.283 2.246 2.210 2.174 2.140 2.106 2.074 2.042 2.011 1.981 1.952 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.102 3.037 2.974 2.914 | 2.855 2.798 2.743 2.690 2.639 2.589 2.540 2.494 2.448 2.404 2.362 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3.352 3.274 3.1993.127 3.058 2.991 2.926 2.864 2.803 2.745 2.689 5.242 5.076 4.917 4.767 4.623 4.486 4.355 4.231 4.111 3.998 3.889 3.784 3.685 3.589 3.498 3.410 3.326 3.245 3.167 3.092 3.020 | 2.951 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.712 4.564 4.423 4.288 4.160 4.039 3.922 3.812 3.706 3.605 3.508 3.416 3.327 3.242 3.161 6.733 6.463 6.210 5.971 5.747 5.535 5.335 5.146 4.968 4.799 4.639 4.487 4.344 4.207 4.078 3.954 3.837 3.726 3.619 3.518 3.421 3.329 7.435 7.108 6.802 6.515 6.247 5.995 5.759 5.537 5.328 5.132 4.946 | 4.772 4.607 4.451 4.303 4.163 4.031 3.905 3.786 3.673 3.566 3.463 8.111 7.722 7.360 7.024 | 6.710 6.418 6.145 5.889 5.650 5.426 5.216 5.019 4.8334.659 4.494 4.339 4.1924.054 | 3.923 3.799 3.682 3.571 8.760 8.306 7.887 7.499 7.139 6.805 6.495 6.207 5.938 5.687 5.453 | 5.234 5.029 4.836 4.656 4.486 4.327 4.177 4.035 3.902 3.776 3.656 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.4926.1945.918 5.660 5.421 5.197 4.988 4.793 4.611 4.439 4.278 4.127 3.985 3.851 3.725 9.986 9.394 8.853 8.358 7.904 | 7.487 7.103 6.750 6.424 6.122 5.8425.5835.342 5.1184.910 4.715 4.533 4.362 4.203 4.053 3.912 3.780 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.982 6.628 6.302 6.0025.724 5.468 5.2295.008 4.802 4.611 4.432 4.265 4.108 3.962 3.824 11.118 10.380 9.712 9.108 8.559 8.061 7.606 7.1916.811 6.462 6.142 5.847 5.575 5.324 5.092 4.876 4.675 4.489 4.315 4.153 4.001 3.859 11.652 10.838 10.106 9.447 8.851 8.313 7.824 7.379 6.9746.604 6.2655.954 5.668 5.405 5.162 4.938 4.730 4.536 4.357 4.189 4.033 3.887 12.166 | 11.274 10.477 | 9.763 9.122 8.544 8.022 7.549 7.120 6.729 6.373 6.047 5.749 5.475 5.222 4.990 4.775 4.576 4.391 4.219 4.059 3.910 12.659 11.690 10.828 10.059 9.372 8.756 8.201 7.702 7.250 6.840 6.467 6.128 5.818 5.534 5.273 5.033 4.812 4.608 4.419 4.243 4.080 3.928 13.134 | 12.085 | 11.158 10.336 9.604 8.950 8.365 7.839 7.366 6.938 6.550 6.198 5.8775.584 5.316 5.070 4.843 4.635 4.442 4.263 4.097 3.942 13.590 12.462 | 11.470 10.594 | 9.818 9.129 8.514 7.963 7.4697.025 6.623 6.259 5.9295.628 5.3535.101 4.870 4.657 4.460 4.279 4.110 3.954 14.029 12.821 | 11.764 10.836 10.017] 9.292 8.649 8.075 | 7.562 7.102 6.687 6.3125.9735.665 5.384 5.127 4.891 4.675 4.476 4.292 4.121 | 3.963 14.451 13.163 12.042 11.061 10.201 | 9.442 8.772 8.176 7.645 7.170 6.743 6.359 6.011 5.696 5.410 5.149 4.909 4.690 4.488 4.302 4.130 3.970 14.857 13.489 12.303 11.272 10.371 9.580 8.883 8.266 7.718 7.230 6.792 6.399 6.044 5.723 5.432 5.167 4.925 4.703 4.499 4.311 4.137 | 3.976 15.247 | 13.799 12.550 11.469 10.529 9.707 8.985 8.3487.784 7.283 6.835 6.434 6.073 5.746 5.451 5.182 4.937 4.713 4.507 4.318 4.143 3.981 15.622 14.094 12.783 11.654 10.675 9.823 9.077 8.422 7.8437.330 6.8736.464 6.097 5.766 5.467 5.1954.948 4.721 4.514 4.323 4.147 3.985 15.983 14.375 13.003 11.826 10.810 9.929 9.161 8.488 7.896 7.372 6.906 6.491 6.1185.783 5.480 5.2064.956 4.728 4.520 4.328 4.151 3.988 16.330 14.643 13.211 11.987 10.935 | 10.027 | 9.237 8.548 7.943 7.409 6.514 6.136 5.798 5.492 5.215 4.964 4.734 4.524 4.332 4.154 3.990 16.663 | 14.898 13.406 12.137 11.051 10.116 | 9.307 8.602 7.984 7.441 6.961 6.534 6.152 5.810 5.502 5.223 4.970 4.739 4.528 4.335 4.157 3.992 16.984 15.141 13.591 12.278 11.158 10.1989.370 8.650 8.022 7.470 6.983 6.551 6.166 5.820 5.510 5.2294.975 4.743 4.531 4.337 4.159 | 3.994 17.292 15.372 13.765 12.409 | 11.258 10.2749.427 8.694 8.055 7.496 7.003 6.566 6.177 5.829 5.517 5.235 4.979 4.746 4.534 4.3394.160 3.995 19.793 17.159 | 15.046 13.332 11.925 10.757 | 9.7798.951 8.244 7.634 7.105 6.642 6.233 5.871 | 5.548 5.258 4.997 4.760 4.544 4.347 4.166 3.999 6.935 00 Which of the following four options is true? 1 points Choices Option 1 Option 2 Option 3 Option 4 Yes Does Consider Does the Time Value Consider of Money Cash Flows No Yes No Yes No No Yes Capital Budgeting Method Payback method Net present value method Internal rate of return method Simple rate of return eBook Print Multiple Choice References Option 1 O O Option 2 Option 3 O Option 4