Question 1 Cullumber Co. purchased some equipment 3 years ago. The company's required rate of return is 12%, and the net present value of the project was $(700). Annual cost savings were: $5000 for year 1; 3000 for year 2; and $1000 for year 3. The amount of the initial investment was PV of an Annuity of1 at 12% Present Value Year of1 at 120 0.893 0.893 1.690 2.402 2 0.797 0.712 $8268 $6506 $7906. $6868