1. An investment project requires an initial outlay of $8 000 (Present value cost) and will produce a return of $17 000 (future value) at the end of the five years. Use the Net Present Value Method to decide if this project is worthwhile, if the rate is 15% compounded annually.

2. An investment project requires an initial outlay of $20 000 and will produce a return of $55 000 at the end of the three years. Use the Net Present Value Method to decide if this project is worthwhile, if the rate is 9% compounded annually.

3. An investment project requires an initial outlay of $106 000 and will produce a return of $249 000 at the end of the 10 years. Use the Net Present Value Method to decide if this project is worthwhile, if the rate is 12% compounded annually

Answer rating: 100% (QA)

Net present value is the present value of cost outflows less the present value of cost inflows The f... View the full answer