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OmegaTech is considering project A. The project would require an initial investment of $51,600.00, and then have an expected cash flow of $78,300.00 in 4
OmegaTech is considering project A. The project would require an initial investment of $51,600.00, and then have an expected cash flow of $78,300.00 in 4 years. Project A has an internal rate of return of 9.78 percent. The weighted-average cost of capital for OmegaTech is 6.98 percent. Which one of the following assertions is true?
| The NPV that OmegaTech would compute for project A is equal to greater than $10.28. | ||
| The NPV that OmegaTech would compute for project A is greater than -$10.28 but less than $10.28. | ||
| None of the other alternatives are correct | ||
| The NPV that OmegaTech would compute for project A is less than or equal to -$10.28. | ||
| The NPV that OmegaTech would compute for project A can not be computed from the information provided |
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