1. Lyndon Company has been offered a contract to build a bridge for the state of Michigan/>/>. The contract would expire in ten years. The projected cash flows that result from the contract are given below:

   Cost of equipment $500,000

   Working capital needed $100,000

   Net annual cash inflows $80,000

   Salvage value of equipment in ten years $40,000

   Working capital released $100,000

   The company's required rate of return and discount rate is 12%. The working capital would be released at the end of project.

   What is the net present value of the project?

   		a. $(102,904)
   		b. $(135,104)
   		c. $102,904
   		d. $135,104