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Yellow Stone Ltd has made an initial investment of R 5 0 0 0 0 0 in a new project. The firm s cost of

Yellow Stone Ltd has made an initial investment of R500000 in a new project. The firms cost of capital is 12%. The investment is expected to generate the following cash inflows over the next five years:
Year 1: R 50000
Year 2: R 60000
Year 3: R150000
Year 4: R140000
Year 5: R300000
The NPV is ...; therefore, the investment should ...
a.
-R82567; not be undertaken.
b.
R41558; be undertaken.
c.
-R41558; not be undertaken.
d.
R82567; be undertaken.

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