What is the net present value of a project with the following cash flows if the discount rate is 15 percent? $$\begin{array} { | c | r | }
\hline \text { Year } & \text { Cash Flow } \
\hline 0 & - \$ 48,100 \
\hline 1 & 15,600 \
\hline 2 & 28,900 \
\hline 3 & 15,200 \
\hline
\end{array}$$
A)-$2,687.98
B)-$1,618.48
C)$1,044.16
D)$1,035.24
E)$9,593.19

Question

What is the net present value of a project with the following cash flows if the discount rate is 15 percent? $$\begin{array} { | c | r | } 
\hline \text { Year } & \text { Cash Flow } \
\hline 0 & - \$ 48,100 \
\hline 1 & 15,600 \
\hline 2 & 28,900 \
\hline 3 & 15,200 \
\hline
\end{array}$$
A)-$2,687.98
B)-$1,618.48
C)$1,044.16
D)$1,035.24
E)$9,593.19

Quizplus · Accepted Answer

The correct answer is A. The net present value of the project is -$2,687.98. This is calculated by taking the sum of the present values of the cash flows, which is -$2,687.98. The present value of a cash flow is calculated by dividing the cash flow by the discount factor, which is 1 + the discount rate raised to the power of the number of years.

What Is the Net Present Value of a Project with the Following