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TheQuestion Blank 1 of 1 net present value method considers cash inflows along with cash outflows.Question at position 8 8 5 points Question at position

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TheQuestion Blank 1 of 1net present value method considers cash inflows along with cash outflows.Question at position 885 points
Question at position 8 A company is evaluating the following 5 year contract. Cost of equipment $200,000Working capital $100,000Recalibration equipment year 3 $50,000Salvage value year 5 $7,000Annual net cash inflows $100,000PV of ordinary annuity for 5 years at 10%=3.791PV of $1 at 10% year 3=.751PV of $1 at 10% year 5=.621Working capital requirements will be released in year 5The Companys discount rate is 10% What is the net present value for this project?A company is evaluating the following 5 year contract. Cost of equipment $200,000Working capital $100,000Recalibration equipment year 3 $50,000Salvage value year 5 $7,000Annual net cash inflows $100,000PV of ordinary annuity for 5 years at 10%=3.791PV of $1 at 10% year 3=.751PV of $1 at 10% year 5=.621Working capital requirements will be released in year 5The Companys discount rate is 10% What is the net present value for this project?$45,897 negative net present value$45,897 positive net present value$107,997 positive net present value$107,997 negative net present value
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