Project #57745 - finance (just 3 questions)

A project produces the following Cash Flows during the next 3 years:

 Year 1 2 3 Cash Flow 456 567 678

If the cost of capital is 12%, what is the project’s Present Value (PV)?

A factory costs \$ 400,000. It will produce an inflow (after operating costs) of \$ 100,000 in year 1, \$ 200,000 in year 2 and \$ 300,000 in year 3.

The opportunity cost of capital is 12%.

Calculate the NPV.

An aunt of yours intends to bequeath you her savings.

She offers you three choices:

(a) receiving \$ 100,000 today or

(b) receiving \$ 200,000, after ten years or

(c) receiving \$ 25,000 every year for the next 5 years.

If the interest rate is 6.75%, which option would you choose?

Indicate the amount you would receive under the best option in round \$.

 Subject Mathematics Due By (Pacific Time) 02/14/2015 11:00 pm
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