K Castle Company is considering an investment opportunity with the following expected net cash inflows: Year 1, $275,000; Year 2, $155,000; Year 3, $115,000. The company uses a discount rate of 8% and the initial investment is $340,000. (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Calculate the NPV of the investment. Should the company invest in the project? Why or why not? Use the following table to calculate the net present value of the project. (Enter any factor amounts to three decimal places, X.XXX.) Years Year 1 Present value of each year's inflow: (n = 1) Year 2 Present value of each year's inflow: (n = 2) Year 3 Present value of each year's inflow: (n = 3) Total PV of cash inflows Year 0 Initial investment Net present value of the project Net Cash Inflow PV Factor (i = 8%) Present Value eference Present Value of $1 57 Periods 1% 2% 3% 4% 5% 6% 7% 0.962 0.952 0.943 0.935 Period 2 0.925 0.907 0.890 0.873 18% 16% 0.870 0.862 0.847 0.833 Period 1 0.990 0.980 0.971 0.756 0.980 0.961 0.943 8% 9% 0.926 10% 0.926 0.917 0.909 0.893 0.917 0.909 0.893 12% 15% 14% 20% 0.877 0.857 0.857 0.842 0.826 0.797 0.769 0.769 0.756 0.743 0.718 0.694 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0.712 0.675 0.658 0.641 0.609 0.579 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.763 0.735 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.713 0.681 0.708 0.683 0.650 0.621 0.636 0.567 0.592 0.572 0,592 0.572 0.552 0.516 0.482 0.519 0.497 0.519 0.497 0.476 0.437 0.402 Period 6 0.942 0.888 0.837 Period 7 0.933 0.871 0.813 0.760 Period 8 0.923 0.853 0.789 0.731 0.677 Period 9 0.790 0.746 0.705 0.666 0.711 0.665 0.623 0.627 0.914 0.837 0.766 0.703 0.645 0.592 Period 10 0.905 0.820 0.744 0.676 0.614 0.558 0.630 0.596 0.564 0.507 0.456 0.432 0.410 0.370 0.335 0.583 0.547 0.513 0.452 0.400 0.376 0.354 0.314 0.279 0.582 0.540 0.502 0.467 0.404 0.351 0.327 0.305 0.266 0.233 0.544 0.500 0.460 0.424 0.361 0.308 0.284 0.263 0.225 0.194 0.508 0.463 0.422 0.386 0.322 0.270 0.247 0.227 0.191 0.162 Period 11 0.896 0.804 0.722 0.650 Period 12 0.887 0.788 0.701 0.625 0.557 Period 13 0.879 0.773 0.681 0.601 0.530 Period 14 0.870 0.758 0.661 0.577 0.505 Period 15 0.861 0.743 0.642 0.555 0.481 0.585 0.527 0.497 0.475 0.429 0.388 0.350 0.287 0.237 0.215 0.195 0.162 0.135 0.444 0.112 0.469 0.415 0.442 0.388 0.417 0.362 0.397 0.356 0.319 0.257 0.208 0.187 0.168 0.137 0.368 0.326 0.290 0.229 0.182 0.163 0.145 0.116 0.093 0.340 0.299 0.263 0.205 0.160 0.141 0.125 0.099 0.078 0.315 0.275 0.239 0.183 0.140 0.123 0.108 0.084 0.065 Period 16 0.853 0.728 0.623 0.534 0.458 Period 17 0.844 0.714 0.605 0.513 0.436 0.394 0.339 0.292 0.371 0.317 0.270 Period 18 0.836 0.700 0.587 0.494 0.416 0.350 0.296 0.296 0.250 Period 19 0.828 0.686 0.570 0.475 Period 20 0.820 0.673 0.554 0.456 0.377 0.396 0.331 0.277 0.312 0.258 Period 21 0.811 0.660 0.538 0.439 0.359 0.242 Period 22 0.803 0.647 0.522 0.422 0.342 0.226 Period 23 0.795 0.634 0.507 0.406 0.326 0.262 0.211 Period 24 0.788 0.622 0.492 0.390 0.310 0.247 0.197 Period 25 0.780 0.610 0.478 0.375 0.295 0.233 0.184 0.294 0.278 0.252 0.218 0.163 0.123 0.107 0.093 0.071 0.054 0.231 0.198 0.146 0.108 0.093 0.080 0.060 0.045 0.250 0.212 0.180 0.130 0.095 0.081 0.069 0.051 0.038 0.232 0.194 0.164 0.116 0.083 0.070 0.060 0.043 0.031 0.215 0.178 0.149 0.104 0.073 0.061 0.051 0.037 0.026 0.199 0.164 0.135 0.093 0.064 0.053 0.044 0.031 0.022 0.184 0.150 0.123 0.083 0.056 0.046 0.038 0.026 0.018 0.170 0.138 0.112 0.074 0.049 0.040 0.033 0.022 0.015 0.158 0.126 0.102 0.066 0.043 0.035 0.028 0.019 0.013 0.146 0.116 0.092 0.059 0.038 0.030 0.024 0.016 0.010 Print Done Present Val of Ordinary Annuity of $1 Periods 1% 2% 3% 4% Period 1 0.990 0.980 0.971 0.962 Period 2 1.970 1.942 1.913 Period 3 2.941 2.884 Period 4 3.902 3.808 Period 5 4.853 4.713 Period 6 5.795 10.368 9.787 9.253 11.255 10.575 9.954 1.886 1.859 1.833 1.808 1.783 1.759 1.736 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 5.601 5.417 5.242 5.076 4.917 4.767 Period 7 6.728 6.472 6.230 6.002 5.786 5.582 5.389 Period 8 7.652 7.325 7.020 6.733 6.463 6.210 5.971 Period 9 8.566 8.162 7.786 7.435 7.108 6.802 6.515 Period 10 9.471 8.983 8.530 8.111 7.722 7.360 7.024 Period 11 8.760 8.306 7.887 7.499 Period 12 9.385 8.863 8.384 7.943 Period 13 12.134 11.348 10.635 9.986 9.394 8.853 8.358 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.745 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 9.108 Period 16 Period 17 5% 6% 7% 8% 9% 10% 12% 14% 15% 0.952 0.943 0.935 0.926 0.917 0.909 0.893 0.877 0,870 1.690 1.647 1626 2.402 2.322 2.283 16% 18% 20% 0.862 0.847 0.833 1.605 1.566 1.528 2 246 2.174 2.106 3.037 2.914 3.605 3.433 4.623 4.486 4.355 4.111 3.889 3.784 3.685 3.498 3.326 5.206 5.033 4.868 4.564 4.288 4.160 4.039 5.747 5.535 5.335 4.968 4.639 4.487 4.344 6.247 5.995 5.759 5.328 4.946 4.772 6.710 6.418 6.145 5.650 5.216 2.855 2.798 2.690 2.589 3.352 3.274 3.127 2.991 3.812 3.605 4.078 3.837 4.607 4.303 4.031 5.019 4.833 4.494 4.192 8.244 7.786 7.367 8.559 8.061 7.606 Period 18 Period 19 Period 20 Period 21 14.718 13.578 12.561 11.652 10.838 10.106 9.447 15.562 14.292 13.166 12.166 11.274 10.477 9.763 9.122 8.544 8.022 16.398 14.992 13.754 12.659 11.690 10.828 10.059 9.372 8.756 8.201 17.226 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.129 8.851 8.313 7.824 7.139 6.805 6.495 5.938 5.453 7.536 7.161 6.814 6.194 5.660 5.421 7.904 7.487 7.103 6.424 5.842 5.583 5.342 4.910 4.533 6.628 6.002 5.724 5.468 5.008 4.611 6.811 6.142 5.847 5.575 5.092 4.675 6.974 6.265 5.954 5.669 5.162 4.730 7.120 5.234 5.029 4 656 4.327 5.197 4.793 4.439 6.373 6.047 5.749 5.222 4.775 7.250 6.467 6.128 5.818 5.273 4.812 7.366 6.550 6.198 5.877 5.316 4.844 Period 22 Period 23 Period 24 Period 25 8.514 18.857 17.011 15.415 14.029 12.821 11.764 10.836 10.017 9.292 8.649 19.660 17.658 15.937 14.451 13.163 12.042 11.061 10.201 9.442 8.772 20.456 18.292 16.444 14.857 13.489 12.303 11.272 10.371 9.580 8.883 21.243 18.914 16.936 15.247 13.799 12.550 11.469 10.529 9.707 8.985 22.023 19.523 17.413 15.622 14.094 12.783 11.654 10.675 9.823 9.077 7.469 6.623 6.259 5.929 5.353 4.870 7.562 6.687 6.312 7.645 6.743 6.359 5.973 5.384 4.891 6.011 5.410 4.909 7.718 7.784 6.835 7.843 6.873 6.792 6.399 6.044 5.432 4.925 6.434 6.073 5.451 4.937 6.464 6.097 5.467 4.948 Print Done