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Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this
Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistics for the project are 2.0 and 3.0 years, respectively. |
Time: | 0 | 1 | 2 | 3 | 4 | 5 | 6 |
Cash flow | $7,200 | $1,150 | $2,350 | $1,550 | $1,550 | $1,350 | $1,150 |
Use the NPV decision rule to evaluate this project. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.) |
NPV | $ |
Should it be accepted or rejected? |
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