Waste Industries is evaluating a $51,300 project with the following cash flows.

Years		Cash Flows
1		$	9,000
2			20,900
3			23,500
4			16,300
5			24,300

The coefficient of variation for the project is 0.945.

Coefficient of Variation				Discount Rate
0		0.25			6	%
0.26		0.50			8	%
0.51		0.75			12	%
0.76		1.00			16	%
1.01		1.25			20	%

Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. a. Select the appropriate discount rate.

• 6%

• 8%

• 12%

• 16%

• 20%

b. Compute the net present value. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.)

c. Based on the net present value should the project be undertaken?