The net present value (WPV) rule is considered one of the most common and preferred eriteria that generally lead to good investment decisions. Consider this case: Suppose Black Sheep Broadeasting Company is evaluating a proposed eapital budgeting project (project Beta) that will require an initial investment of $2,225,000. The project is expected to generate the following net cash flows: Black Sheep Broadeasting Company's weighted average cost of eapital is 10%, and project Beta has the same risk as the firm's average project. Based on the cash flows, what is project Beta's NPV? $1,167,623$3,198,019$973,019$498,019 Making the accept or reject decision Black Sheep Brosdeasting Company's decision to accept or reject project Bets is independent of its decisions on other projects. If the firm follows the NPV method, it should project Bets. Suppose your boss has asked you to analyze two mutuslly exelusive projects-project A and project B. Both projects require the same investment amount, and the sum of eash inflows of Project A is larger than the sum of eash inflows of project B. A coworker told you that you don't need to do an NPV analysis of the projects because you already know that project A will have a larger NPV than project B. Do you agree with your coworker's statement? Yes, project A will always have the largest NPV, because its eash inflows are greater than project B's cash inflows. No, the NPV calaulation will take into account not only the projects' cash inflows but also the timing of eash inflows and outflows. Consequently, project B could have a larger NPV than project A, even though project A has larger cash inflows. No, the NPV calkulation is based on percentage returns, so the size of a project's cash flows does not affect a project's NPV