Suppose Lumbering Ox Truckmakers is evaluating a proposed capital budgeting project (project Alpha) that will require an initial Investment of $500,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $325,000 Year 2 $475,000 $450,000 $425,000 Year 3 Year 4 Lumbering Ox Truckmakers's weighted average cost of capital is 7%, and project Alpha has the same risk as the firm's average project. Based on th cash flows, what is project Alpha's net present value (NPV)? $410,186 $910,166 $1,385,186 51,092,223 Making the accept or reject decision Lumbering Ox Truckmakers's decision to accept or reject project Alpha is independent of its decisions on other projects. If the firm follows the NPV Making the accept or reject decision Lumbering Ox Truckmakers's decision to accept or reject project Alpha is independent of its decisions on other projects. If the firm follows the NPV method, it should project Alpha Which of the following statements best explains what it means when a project has an NPV of $0? When a project has an NPV of so, the project is earning a profit of $0. A firm should reject any project with an NPV of 0, because the project is not profitable. When a project has an NPV of $0, the project is earning a rate of return equal to the project's weighted average cost of capital. It's OK to accept a project with an NPV of $0, because the project is eaming the required minimum rate of return When a project has an NPV of so, the project is earning a rate of return less than the project's weighted average cost of capital. It's OK to accept the project, as long as the project's profit is positive