Calculate net present value for project a for monson company

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Reference no: EM132771514

Monson Company is considering three investment opportunities with cash flows as described below: (Ignore income taxes in this problem.)

Project A: Cash investment now $15,000

Cash inflow at the end of 5 years $21,000

Cash inflow at the end of 8 years $21,000

Project B: Cash investment now $11,000

Cash outflow for 5 years $3,000

Addition cash inflow at the end of 5 years $21,000

Problem a. Calculate the net present value for project A. Monson Company uses a 12% discount rate.

Problem b. Calculate the net present value for project B. Monson Company uses a 12% discount rate.

Problem c. Which project should the company accept and why?

Reference no: EM132771514

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