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Sheila Goodman recently received her MBA from the Harvard Business School. She has joined the family business, Goodman Software Products Incorporated, as Vice-President of Finance.

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Sheila Goodman recently received her MBA from the Harvard Business School. She has joined the family business, Goodman Software Products Incorporated, as Vice-President of Finance. She believes in adjusting projects for risk. Her father is somewhat skeptical but agrees to go along with her. Her approach is somewhat different than the risk-adjusted discount rate approach, but achieves the same objective. She suggests that the inflows for each year of a project be adjusted downward for lack of certainty and then be discounted back at a risk-free rate. The theory is that the adjustment penalty makes the inflows the equivalent of risk-less inflows, and therefore a risk-free rate is justified. A table showing the possible coefficient of variation for an inflow and the associated adjustment factor is shown next: Assume a $180,000 project provides the following inflows with the associated coefficients of variation for each year, Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial caleulotor methods. a. Fill in the table below: Note: Do not round intermediate calculations. Round "Adjustment Factor" answers to 2 decimal places and other answers to the nearest whole dollar. b-1. if the risk-free rate is 5 percent, compute the net present value of the adjusted inflows. Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places. b-1. If the risk-free rate is 5 percent, compute the net present value of the adjusted inflows. Notei Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places. b-2. Should this project be accepted

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