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How Much Could NPV Be Affected by a Worst-Case Scenario

Question 54

Multiple Choice

How much could NPV be affected by a worst-case scenario of 25 percent reduction from the $3 million in expected annual cash flows on a five-year project with 10 percent cost of capital? (use the values in dollar)


A) $2,843,090
B) $3,750,000
C) $4,578,825
D) $6,155,274

Correct Answer:

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