Question: answer #2 please begin{tabular}{|cc|} hline Year & Cash Flows hline 0 & 5,881 1 & 1,551 2 & 1,635 3 &
answer #2 please
\begin{tabular}{|cc|} \hline Year & Cash Flows \\ \hline 0 & 5,881 \\ 1 & 1,551 \\ 2 & 1,635 \\ 3 & 1,722 \\ 4 & 2,029 \\ \hline \end{tabular} Currently, the investor's required rate of return 6.0% Please compute the project's NPV (hint: it is positive). What if interest rates in the broad economy went up. 2 and also the firm became riskier? Investors would require a higher rate of return. 1. Suppose the required rate increases 2%. How much would the NPV drop? A Between 200 and 270 B Between 270 and 280 C Between 280 and 290 D Between 290 and 300 2. Should the firm still accept the project? A Yes B No
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