Quantitative Methods Q58

58A project requires an initial outlay of $750,000. It is expected to produce $200,000 in the first year, $300,000 in the second year, and $400,000 in the third year. The project’s opportunity cost of capital is 10 percent. Which of the following is most likely the net present value of the project?

Option : B
Explanation : Using a financial calculator, enter the following cash flows to compute NPV. CF0 = -750,000; CF1 = 200,000; CF2 = 300,000; CF3 = 400,000; I = 10; CPT NPV = -19,722.

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