Halcyon Lines is considering the purchase of a new bulk carrier for $8.3 million. The forecasted revenues are $5.3 million a year and operating costs are $4.3 million. A major refit costing $2.3 million will be required after both the fifth and tenth years. After 15 years, the ship is expected to be sold for scrap at $1.8 million. What is the NPV if the opportunity cost of capital is 12%?

Gregg Snead has been offered four investment opportunities, all equally priced at $45,000. Because the opportunities differ in risk, Greggs required returns (i.e., applicable discount rates) are not the same for each opportunity. The cash flows and required returns for each opportunity are summarized below