Bruno's Motor Shop is expanding and expects operating cash flows of $26,000 a year for 4 years as a result. This expansion requires $39,000 in new fixed assets. These assets will be worthless at the end of the project. In addition, the project requires $30,000 of net working capital which will be recouped when the project ends. What is the net present value of this expansion project at a required rate of return of 16 percent?
a.$20,321.43
b.$38,720.39
c.$22,920.24
d.$46,620.92
e.$46,480.47
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ANSWER : a : 20321.43
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