Is this a positive npv project

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Reference no: EM133210657

Question: You are analyzing the feasibility of setting up a high-end tattoo parlor in East Nashville. It would require an immediate start-up cost of $700,000, an additional investment of $500,000 at the end of the first year, and follow-on investments of $200,000 at the end of both the second and the third year. The operating cash-flow would be a loss of $100,000 at the end of the first year, and then a positive $225,000 at the end of the second through thirteenth years. If these are the only cash flows, and the opportunity cost of capital is 9% per year, is this a positive NPV project?

Reference no: EM133210657

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