A customer presently buys $500,000/month from your firm. It has promised to increase sales by 10% if you offer it 90-day terms (you presently extend 30-day terms). Your firm's opportunity cost is 8%. PV = FV / [1 + (k/365)(n)] PV perp CF k Cash Flow Per Period Interest Rate Per Period What is the NPV of a single sale with the present arrangement ($500,000 a month)? $539,360 $42,627 $496,734 $6,394,013 What is the impact on NPV for a single sale if the new proposal is accepted? $496,734 $6,394,013 $539,360 $42,627 If the change is permanent, what is the aggregate impact on NPV? $6,394,013 $539,360 $496,734 $42,627 The firm should agree to the change False, because NPV is higher True, because NPV is lower False, because NPV is lower True, because NPV is higher