The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions.

Consider this case:

Suppose Green Caterpillar Garden Supplies Inc. is evaluating a proposed capital budgeting project (project Beta) that will require an initial investment of $3,000,000. The project is expected to generate the following net cash flows:

Year	Cash Flow
Year 1	$375,000
Year 2	$425,000
Year 3	$500,000
Year 4	$500,000

Green Caterpillar Garden Supplies Inc.s weighted average cost of capital is 8%, and project Beta has the same risk as the firms average project. Based on the cash flows, what is project Betas NPV?

-$1,023,978

$1,476,022

-$4,523,978

-$1,523,978