The following data is available for an investment object: Acquisition cost: 60,000
Operating cash flows: 20,000 in year 1; 30,000 in year 2; 35,000 in year 3.
Using the NPV model with a discount rate of 10%, which of the following is true?
A) If the investment is realized, a positive NPV of approximately 9,300 can be achieved.
B) If the investment is realized, a negative NPV of approximately 9,300 can be achieved.
C) If the investment is realized, a negative NPV of approximately 25,000 can be achieved.
D) If the investment is realized, a positive NPV of approximately 25,000 can be achieved.
Correct Answer:
Verified
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