Multiple Choice
ABC Company in considering a loss control investment.The project will cost $100,000.It will generate an after-tax net cash flow of $60,000 one year after investment and an after-tax net cash flow of $60,000 two years after investment.The present value of $1 received one year from today assuming a 6 percent rate is .9434.The present value of $1 received two years from today assuming a 6 percent interest rate is .8900.Assuming a discount rate of 6 percent,what is the net present value (NPV) of this project?
A) $10,004
B) $13,195
C) $16,604
D) $20,000
Correct Answer:
Verified
Correct Answer:
Verified
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