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Alfarsi Industries uses the net present value method to make investment decisions and requires a 15% annual return on all investments. The company is considering
Alfarsi Industries uses the net present value method to make investment decisions and requires a 15% annual return on all investments. The company is considering two different investments. Each require an initial investment of $15,600 and will produce cash fows as followe End of Year 1 2 3 Investment B $8,600 $ 8,600 8,600 25,800 The present value foctors of $f each year at 15% are: 1 2 3 0.8696 0.7561 0.6575 The present value of an annuity of $1 for 3 years at 15% is 2.2832 The net present value of Investment Als: Multiple Choice $16,964 $(15,600) $10,200 $(19,636) $4.036
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