A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows: Year Cash Flow -$ 41,000 20,000 23,000 14,000 2. 3. What is the NPV of the project if the required return is 11 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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A firm evaluates all of its projects by applying the NPV decision rule. A project under
consideration has the following cash flows:
Year
Cash Flow
0.
-$ 41,000
20,000
23,000
14,000
1
3.
What is the NPV of the project if the required return is 11 percent? (Do not round
intermediate calculations and round your answer to 2 decimal places, e.g.., 32.16.)
NPV
At a required return of 11 percent, should the firm accept this project?
No
O Yes
What is the NPV of the project if the required return is 24 percent? (A negative
answer should be indicated by a minus sign. Do not round intermediate calculations
and round your answer to 2 decimal places, e.g., 32.16.)
Transcribed Image Text:A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows: Year Cash Flow 0. -$ 41,000 20,000 23,000 14,000 1 3. What is the NPV of the project if the required return is 11 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g.., 32.16.) NPV At a required return of 11 percent, should the firm accept this project? No O Yes What is the NPV of the project if the required return is 24 percent? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
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