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Pickleball Company is considering the following investment proposal: Initial investment: Depreciable assets (straight-line) $72,000 Working capital 8,000 Operations (per year for 4 years): Cash receipts
Pickleball Company is considering the following investment proposal:
Initial investment: |
Depreciable assets (straight-line) | $72,000 | |
Working capital | 8,000 |
Operations (per year for 4 years): |
Cash receipts | $50,000 | |
Cash expenditures | 22,000 |
Disinvestment: |
Salvage value of equipment | $6,000 | |
Recovery of working capital | 8,000 |
Discount rate: | 10 percent |
Using a spreadsheet or financial calculator, determine the net present value for the investment. The investment's net present value is:
Select one:
A. $ 8,756
B. $18,318
C. $88,756
D. $98,318
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