Determine the net present value of investment opportunity is

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Question 1: RNXD Inc. has the opportunity to market a product for 5 years under a specialty contract. The product will provide the company with net cash flows of $40,000. The investment calls for an initial working capital investment $280,000. The investment also calls for the purchase of equipment for $200,000. The machinery will have a salvage value of $45,000 at the end of the contract. RNXD Inc. is subject to a 16% discount rate. The net present value of this investment opportunity is:

a) $74720

b) $14170

c) $-187200

d) $-194340

Reference no: EM132585950

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