Question: Bottleneck Industries is considering project A. The project has expected cash flows of -$29,700.00 today, $39,600.00 in 1 year, -$49.200.00 in 2 years, and $59,100.00
Bottleneck Industries is considering project A. The project has expected cash flows of -$29,700.00 today, $39,600.00 in 1 year, -$49.200.00 in 2 years, and $59,100.00 in 3 years. The weighted average cost of capital for Bottleneck Industries is 26.44 percent. Which one of the following assertions is true?
The NPV of project A cannot be computed, because the project's expected cash flows are not conventional and it is impossible to compute the NPV of a project with expected cash flows that are not conventional
O The NPV of project A equals an amount that is equal to or greater than $ 4.28
The NPV of project A equals an amount that is greater than $4.28 but less than $4.28.
O Even though project A's expected cash flows are not conventional and even though it is possible to compute the NPV of a project with expected cash flows that are not conventional, the NPV of project A cannot be computed
O The NPV of project A equals an amount that is less than or equal to $4.28
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