1. Assume that a firm takes on a project that requires it to make an investment in net operating working capital (NOWC) of $5,000 and an investment in gross fixed assets (GFA) of $25,000, both of these investments being made in Year 0. Assume that no other investments are required, but that this project will produce free cash flows, starting in one year, of $2,750 per year in all future years (Years 1 through infinity). The firm has determined that, based on the risk, the weighted average cost of capital (WACC) for this project is 8 percent. Calculate the net present value (NPV) for this project.

A. $2,581

B. $5,137

C. $3,966

D. $4,375

E. $3,208