Question
Waste Industries is evaluating a $56,200 project with the following cash flows. Years Cash Flows 1 $ 9,630 2 12,100 3 24,500 4 24,500 5
Waste Industries is evaluating a $56,200 project with the following cash flows. Years Cash Flows 1 $ 9,630 2 12,100 3 24,500 4 24,500 5 31,300 The coefficient of variation for the project is 0.654. Coefficient of Variation Discount Rate 0 0.25 4 % 0.26 0.50 7 % 0.51 0.75 10 % 0.76 1.00 12 % 1.01 1.25 18 % 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. multiple choice 1 4% 7% 18% 10% 12% 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? multiple choice 2 No Yes
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