Question: NPV 3. Giambona Industries is considering Project AA whose future expected cash flows are shown below. However, the up-front cost of the project (X) is

NPV

3. Giambona Industries is considering Project AA whose future expected cash flows are shown below. However, the up-front cost of the project (X) is not given. You are told that the project has a WACC of 10% and that the projects NPV is zero. Based on this information, what is the up-front cost of the project, i.e., what is X?

WACC = 10%

Year: 0 1 2 3 4

CF_S: X $624 $440 $150 $ 18

a. -$ 488.63

b. -$ 677.70

c. -$ 866.81

d. -$1,055.90

e. -$1,232.00

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