**Calculating the Net Present Value (NPV): Should You Take the Contract?**Your storage firm has been offered $98,100 in one year to store some goods for one year. Assume your costs are $96,100, payable immediately, and the cost of capital is 8.7%. Should you take the contract?---The NPV will be $ [___]. (Round to the nearest cent.)

Net present value is the modern methods of capital budgeting that is used to determine the present…

Answered: Your storage firm has been offered…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Your storage firm has been offered $98,100 in one year to store some goods for one year. Assume your costs are $96,100, payable immediately, and the cost of capital is 8.7%. Should you take the contract? The NPV will be $ (Round to the nearest cent.)