A project requires an initial outlay of P 100 000. The relevant inflows associated with the project are P 60 000 in year one and P 50 000 in years two and three. The appropriate discount rate for this project is 11%. Compute the net present value. Should the company accept the project?
A project requires an initial outlay of P 100 000. The relevant inflows associated with the project are P 60 000 in year one and P 50 000 in years two and three. The appropriate discount rate for this project is 11%. Compute the net present value. Should the company accept the project?
Chapter11: Capital Budgeting And Risk
Section: Chapter Questions
Problem 14P
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![A project requires an initial outlay of P 100 000. The relevant inflows
associated with the project are P 60 000 in year one and P 50 000 in years two
and three. The appropriate discount rate for this project is 11%. Compute the
net present value. Should the company accept the project?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fbecf67d4-5bf3-4d7b-bcd4-114620d16da5%2Fc1ce7304-5fe0-4594-bafc-3ff7d0607d0c%2Fpq9kb4s_processed.png&w=3840&q=75)
Transcribed Image Text:A project requires an initial outlay of P 100 000. The relevant inflows
associated with the project are P 60 000 in year one and P 50 000 in years two
and three. The appropriate discount rate for this project is 11%. Compute the
net present value. Should the company accept the project?
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