A Local Community Church Is Contemplating Installment of Solar Cells

Multiple Choice

A local community church is contemplating installment of solar cells on its roof and sell the access electricity to the Ontario grid via a power purchase agreement. The project requires an initial investment of $75 000 with a residual value of $2000 after 10 years. It is estimated to yield annual net returns of $15 000 for 10 years. What is the NPV of the project given a rate of return of 7%?

A) -$31 370
B) $32 387
C) $31 370
D) -$32 387
E) $1017