How does a company in the retail sector utilise the concept

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Question: Assume that, as a large retailer with some surplus cash, you have the opportunity to invest in one of the following two growth-related projects. They are both expected to generate returns over three years, and you require a rate of return of 8% during this time:

Opportunity A	Opportunity A
The initial investment in year 0	$1,300,000	$900,000
Net cash inflows year 1	$400,000	$250,000
Net cash inflows year 2	$500,000	$350,000
Net cash inflows year 3	$600,000	$450,000

Suggest which opportunity the company should invest in and why?
How does a company in the retail sector utilise the concept of the time value of money in its decision-making process?

Reference no: EM133337114

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