A publisher is deciding whether or not to invest in a new printer. The printer would cost $500, and it would increase cash flows by $600 for the next two years. If the cost of capital is 10% then the net present value of the investment is
a. $1041.32
b. $541.32
c. $1090.91
d. $590.91
b
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Which of the following financial assets is most likely to have a higher amount of risk than the others?
A. Stocks B. Bonds C. Mutual funds D. Savings accounts
Under a fixed-rate unified currency regime, each country belonging to the system
a. may pursue an independent monetary policy. b. gives up its monetary policy independence to one central bank with the power to expand and contract the money supply. c. is committed to conducting highly expansionary monetary policy in order to maintain the convertibility of its currency. d. must fix its domestic interest rates in order to maintain the convertibility of its currency.
In the medium run, an increase in government spending that causes an increase in the budget deficit
A) affects the level of output but not its composition. B) affects both the level and composition of output. C) will not affect the composition of output but will affect the price level. D) is neutral. E) none of the above
Wage and property income before transfers and taxes is known as market income.
Answer the following statement true (T) or false (F)