Monday 11 June 2012

The Acu Punct Corporation is considering the purchase

The Acu Punct Corporation is considering the purchase of a new machine with an initial outlay of $4500 and expected cash flows in years 1-4 of $2200 per year. The risk-adjusted discount rate for the firm is 12%, and the risk-free rate is 5%. Compute the net present value of this project.
a. 4300
b. 2181
c. 1899
d. 1535

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