Multiple Choice
Shanghai Shipping is considering investing in a project that requires an after-tax initial investment of 156 million and is expected to produce after-tax cash inflows of $40 million for each of the next five years. The firm's cost of capital is 8%. Based on this information, the NPV of the project is _________ million and the firm should _________ the project.
A) $3.7; accept
B) -$3.7, reject
C) $159.37, accept
D) -$159.37, reject
Correct Answer:
Verified
Correct Answer:
Verified
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