Question
A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows: Year Cash Flow
A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows:
Year | Cash Flow | ||
0 | $ | 28,000 | |
1 | 12,000 | ||
2 | 15,000 | ||
3 | 11,000 | ||
What is the NPV of the project if the required return is 11%? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
NPV $
At a required return of 11% should the firm accept this project?
Yes
No
What is the NPV of the project if the required return is 25%? (Negative answers should be indicated by a minus sign. Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
NPV $
At a required return of 25% should the firm accept this project?
Yes
No
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