what is the net present value of the expansion project?

should be project be rejected or accepted?

A company has to make a decision about expanding its production facilities. Research indicates that the desired expansion would require an immediate outlay of \\( \\$ 170,000 \\) and an outlay of a further \\( \\$ 60,000 \\) in 4 years. The net cash returns are shown below. Find the net present value of the project. According to the net present value criterion, should the expansion project be undertaken if the required rate of return is \8 ? The net present value of the expansion project is \\( \\$ \\) (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) A company has to make a decision about expanding its production facilities. Research indicates that the desired expansion would require an immediate outlay of \\( \\$ 93,000 \\) and an outlay of a further \\( \\$ 60,000 \\) in 5 years. The net casl returns are shown below. Find the net present value of the project. Accordins to the net present value criterion, should the expansion project be undertaken if the required rate of return is \5 ? \\[ \\begin{aligned} \\mathrm{PV}_{\\mathbb{I N}} & =17,000\\left(\\frac{1-1.05^{-7}}{0.05}\ ight)+12,500\\left(\\frac{1-1.05^{-5}}{0.05}\ ight)(1.05)^{-7} \\\\ & =\\$ 136,829 \\end{aligned} \\] The two outlays are an immediate cost of \\( \\$ 93,000 \\) and an additional outlay of \\( \\$ 60,000 \\) five years from now. Find the present value of each outlay and add these values to find the total present value of the outlays, rounding to the nearest dollar. \\[ \\begin{aligned} \\text { PV }_{\\text {OUT }} & =93,000+60,000 \\times(1+0.05)^{-5} \\\\ & =\\$ 140,012 \\end{aligned} \\] Subtract to find the net present value. \\[ \\begin{aligned} \\mathrm{NPV} & =\\mathrm{PV}_{\\mathbb{I N}}-\\mathrm{PV}_{\\text {OUT }} \\\\ & =136,829-140,012 \\\\ & =-\\$ 3,183 \\end{aligned} \\] A capital investment project with a positive or zero net present value