11

Consider a project that requires an initial investment of $5.2 million at time zero. The expected net cash inflows over the five-year life of the project are as follows:

Year 1:$1.2 million

Year 2:$1.4 million

Year 3:$1.6 million

Year 4:$1.8 million

Year 5:$2.0 million

If the required rate of return for the project is 12 percent, what is the net present value (NPV) for the project?

Select one:

a. $206,837

b. $405,135

c. $458,426

d. $492,281

e. none of the above