(Ignore income taxes in this problem.) ABC Co. is considering an investment opportunity having cash flows as described below:

Project I would require an immediate cash outlay of $10,000 and would result in cash savings of $3,000 each year for 8 years.

Required:

If ABC Co. has a required rate of return of 14%, determine if the project is acceptable. Use the NPV method.

A. No acceptable, because NPV is ($3,917)

B. Yes acceptable, because NPV is $3,917

C. It doesnt matter because NPV is $0

D. none of the above