1-Buchanan Corporation forecasts the following payoffs from a project.

Outcome	Probability of Outcome	Assumptions
$ 1,000	15%	pessimistic
$ 3,600	45%	moderately successful
$ 6,000	40%	optimistic

What is the expected value of the outcomes? Multiple Choice ;$4,420;$4,170;$3,533;$3,600

2The Horizon Company will invest $90,000 in a temporary project that will generate the following cash inflows for the next three years. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

Year	Cash Flow
1	$ 28,000
2	25,000
3	70,000

2_The firm will also be required to spend $13,000 to close down the project at the end of the three years.

Compute the net present value if the cost of capital is 11 percent.

what is the net present value?

Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.

Should the investment be undertaken?

multiple choice

No

Yes