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GM has just designed a new Saturn. It forecasts sales of 200,000 cars per year at an average price of $18,000. Costs are expected to

GM has just designed a new Saturn. It forecasts sales of 200,000 cars per year at an average price of $18,000. Costs are expected to be $17,000 / car. The model will sell for 4 years and GM expects an inventory of 40,000 cars.

What is the NPV of the project (choose the most accurate answer)?

a. 680000

b. 800000

c. 880000

d. 1280000

e. none of the above

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