Hello, please help me answer the following prompts for the information below.

• Confirm the calculations or explanations are correct.
• Compare how the required rate of return differs from others.
• Explain how the different rate of returns impacted the concluded NPV.
• Explain why the salvage value is added to the cash flows in the project's final year.

NPV = -300,000 + 300,000 + 500,000 + 800,000 + 4,000,000

1.041 1.042 1.043 1.044 1.045

= $288,461.54 + $277,366.86 + $444,498.18 + $683,843.35 + $3,287,708.43

= $4,404,955.28

=$4,404,955.28 - 3,000,000

=$1,404,955.28

Working capital investments are subtracted each year in the cash flows, because that initial investment is the amount projected the company will need over the years in service to keep flowing and be profitable.

The meaning of the required rate of return for the project is the return the project needs to produce broken down over an annual or quarterly period to satisfy investors to see a return on their money for the initial investment.

Upon Assumption of the auto company having a required rate of return of 15% and the Electrobicycles having a required rate of return 21%. The Electrobicycles is more risky than the auto company because the auto company will require less of a percentage return on the initial investment. This leaves more money for the auto company to use annual toward working capital or any other needs to maintain success.

Based on the calculations concluded for the NPV above the auto company should invest in this project tp build the Electrobicycles because the NPV is greater than zero.