11. Richman Co. purchased some equipment 3 years ago. The company's required rate of return is 12%, and the net present value of the project was $(900). Annual cost savings were: $10,000 for year 1; $8,000 for year 2; and $6,000 for year 3. The amount of the initial investment was Present Value of 1 at 12% PV of an Annuity of 1 at 12% 893 1.690 Year 893 .797 2.402 3 .712 A) $20,478. B) $18,316. O $20,116. D) $18,678. 12. The discount rate is referred to by all of the following alternative names except the A) accounting rate of return. B) cutoff rate. C) hurdle rate. D) required rate of return. 13. The rate that a company must pay to obtain funds from creditors and stockholders is known as the A) hurdle rate. B) cost of capital. C) cutoff rate. D) All of these answers are correct