Compute the npv of this project

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Project Alpha offers the following net cash flows following an initial (year 0), certain outlay (NINV) of $70,000.

Year Net Cash Flow Certainty equivalent factor

1 $30,000 .91

2 $30,000 .79

3 $30,000 .65

4 $20,000 .52

5 $20,000 .40

6 $10,000 .30

a) Compute the NPV of this project at a 12 percent cost of capita

b) If the risk-free rate is 4 percent, what is the certainty equivalent NPV for Project Alpha?

Reference no: EM133074937

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