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A project has an initial cash outflow of $3500. The project has 3 years of life. The project has a medium risk profile with cost

A project has an initial cash outflow of $3500. The project has 3 years of life. The project has a medium risk profile with cost of capital of 8%. Estimates suggest that the certainty equivalent cash inflows for the project are 70% of the expected cash flows. The expected annual cash flows are $1200, $1000, and $1100. If the risk free rate is 5%.



What is the equivalent certainty estimate of the NPV for the project?

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