Use the following table,

Present Value of an Annuity of 1

Period 8% 9% 10%

1 .926 .917 .909

2 1.783 1.759 1.736

3 2.577 2.531 2.487

A company uses a discount factor of 9% when making capital investment decisions. It is considering investing in a project which costs $350,000 and is expected to generate cash inflows of $180,000 and cash outflows of $40,000 at the end of each year for three years. The net present value of this project is

Select one:

a.

$4,340.

b.

$70,000.

c.

$354,340.

d.

$35,436.