Question
Sigma Solutions is considering a project with an initial outlay of CAD 120,000. The project's cash inflows are: Year Cash Flows Initial Investment (120,000) 1
Sigma Solutions is considering a project with an initial outlay of CAD 120,000. The project's cash inflows are:
Year | Cash Flows |
Initial Investment | (120,000) |
1 | 35,000 |
2 | 45,000 |
3 | 50,000 |
4 | 55,000 |
Requirements: a. Determine the payback period for the project. b. Calculate the NPV if the cost of capital is 4%. c. Should Sigma Solutions accept the project based on the NPV criterion?
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Corporate Financial Management
Authors: Glen Arnold
5th edition
978-1292178066, 129217806X, 273758837, 978-0273758839
