A finance manager is evaluating the following project Year Free Cash flows P.V Factor @ 20%

 Present value 

0 (1000) 1.0 (1000) 

1 250 0.833 208.33 

2 250 0.694 173.61 

3 250 0.579 144.68 

4 250 0.482 120.56 

5 250 0.401 100.47 

5 1250 0.401 502.35 

Considering the additivity principle, which of the following statement is not correct 

Select one: 

• The marginal utility of the project is decreasing
• The project has no impact on the marginal utility
• The marginal utility of the project is increasing
• The marginal utility of the project is constant

Answer rating: 100% (QA)

Based on the given information we can calculate the total present value PV of the project by summing ... View the full answer