The owners of a chain of fast-food restaurants spend $24 million installing donut makers in all their restaurants. This is expected to increase cash flows by $9 million per year for the next five years. If the discount rate is 5.2%,were the owners correct in making the decision to install donut makers?

Yes, as it has a net present value (NPV) of

$15

million.

B.No, as it has a net present value (NPV) of

$1

million.

C.No, as it has a net present value (NPV) of

$3

million.

D.Yes, as it has a net present value (NPV) of

$9

million.