32

A project has estimated annual net cash flows of $12,500 for two years and is estimated to cost $45,000. Assume a minimum acceptable rate of return of 20%. Use the Present Value of an Annuity of $1 at Compound Interest table below. Present Value of an Annuity of $1 at Compound Interest Determine (1) the net present value of the profect (if required, round to the nearest dollar) and (2) the pretent walue index (rounded to bwo dedmal places), If required, use the minus sign to indicate a negative net prosent value