8 Year Net Cash Flows 9 Year 1 $8,000 10 Year 2 10,000 11 Year 3 12,000 12 Totals $30,000 13 Initial investment 14 Net present value 15 Present Value of 1 at Present Value of 12% Net Cash Flows 0.8929 $7,143 0.7972 7,972 0.7118 8,542 $23,657 (25,000) $23,657 16 b. Determine whether the project should be accepted or rejected on the basis of net present value. 17 18 value. 19 Rejected