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Compute the net present value of the project

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Question - Ibez Company is considering a project that requires an initial investment of $97,200 and will generate net cash flows of $16,300 per year for 7 years. Ibez requires a return of 8% on its investments. The present value factor of an annuity for 7 years at 8% is 5.2064.

Required -

a. Compute the net present value of the project.

b. Determine whether the project should be accepted or rejected on the basis of net present value.

Reference no: EM133066575

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