The Quick-Start Company Has the Following Pattern of Potential Cash

Multiple Choice

The Quick-Start Company has the following pattern of potential cash flows with its planned investment in a new cold weather starting system for fuel injected cars. If the company has a discount rate of 17%,should it decide to invest?

A) Yes, NPV = $2.2 million
B) Yes, NPV = $21.6 million
C) No, NPV = -$1.9 million
D) Yes, NPV = $8.6 million
E) No, since more than one branch is NPV = 0 or negative, the firm must reject.