25

Beanstalk Computers has a WACC of 5.25% and is considering a project with the following cash flows: Year 0 Year 1 Year 2 Year 3 Year 4 - $1.75 billion $75 million $95 million $550 million $1.12 billion Which of the following statements, about the project, is correct? It should be rejected because the NPV is $90 million. It should be accepted because the NPV is $90 million. It should be accepted because the sum of the future cash flows is greater than the initial outflow. It should be rejected because the NPV is $208.55 million. It should be accepted because the NPV is $208.55 million