Net Present Value Analysis

$\backslash$table$[[$Year $1,$$$8,000$

Round answers to the nearest whole number. Use rounded answers for subsequent calculations.

Use a negative sign with net present value to indicate a negative amount. Otherwise do not use negative signs with your answers.

$\backslash$table$[[$After$-$Tax Cash Flow,Amount,$\backslash$table$[[$Present$],[$Value$]]],[$After$-$tax cash inflows for $5$ years,$$,0,$$$,0],[$Tax savings from depreciation$],[$Year $1,,0,,0],[$Year $2,,0,,0],[$Year $3,,0,,0],[$Year $4,,0,,0],[$Year $5,,0,,0],[$After$-$tax equipment sale proceeds,,$0,,0],[$Total present value of future cash flows,,,,$0],[$Investment required in equipment,,,,$0],[$Net positive $($negative$)$ present value,,,$$,0]]$

Should Champion accept the contract?

Select the most appropriate answer below.

Ochampion should accept the contract because there is a negative net present value.

Thampion should not accept the contract because there is a positive net present value.

Ochampion should accept the contract because there is a positive net present value.

Thampion should not accept the contract because there is a negative net present value.