Question: A project has a net present value of V = 1 0 , 0 0 0 . In order to invest in the project, the

A project has a net present value of V=10,000. In order to invest in the project, the German government requires that you undertake another project with the following cash flow stream: CF0=5000, E[CF1]=1000, E[CF2]=1000, and E[CF3]=1000. The appropriate discount rate for this project is i=10%. What affect does this tie-in project have on your original V estimate? It increases V from 10,000 to 12,513.15. It increases V from 10,000 to 17,486.85. It decreases V from 10,000 to 7,486.85. It increases V from 10,000 to 2,513.15.

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