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What is the net present value of the investment

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Reference no: EM133150213

Question - Bloodflowers Company is considering a long-term investment.

The investment will require an initial investment of $36,000.

You can assume that the investment has no salvage (i.e., ending) value at the end of its 3-year useful life.

Annual cash inflows related to the investment are $25,000.

Annual cash outflows related to the investment are $10,000.

For simplicity, assume that cash flows (other than the initial investment) occur at the end of the year in which they occur.

Assume the cost of capital (i.e., discount rate) is 10%.

Required - What is the net present value of the investment?

Reference no: EM133150213

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