Selection of investment opportunities under npvmonson

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Selection of investment opportunities under NPV.

Monson Company is considering three investment opportunities with cash flows as described below:

Project A

Cash investment now

$15,000

Cash inflow at the end of 5 years

$21,000

Cash inflow at the end of 8 years

$21,000

Project B

Cash investment now

$11,000

Annual Cash outflow for 5 years

$3,000

Additional Cash inflow at the end of 5 years

$21,000

Project C

Cash investment now

$21,000

Annual Cash outflow for 4 years

$11,000

Cash inflow at the end of 3 years

$5,000

Additional Cash inflow at the end of 4 years

$15,000

Required:
Compute the net present value of each project assuming Monson Company uses a 12% discount rate.

Reference no: EM13356095

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