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You are evaluating purchasing the rights to a project that will generate after tax expected cash flows of $90,000 at the end of each of the next five years, plus an additional $1,000,000 at the end of the fifth year as the final cash flow.You can purchase this project for $950,000. If your firm's cost of capital (aka required rate of return) is 15%, what is the NPV of this project?

a. 500,000

b. 950,000

c. 106,000

d. 151,000

e. insufficient information to estimate an NPV

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M969768

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