Jamaica Corp. is adding a new assembly line at a cost of $8.5 million. The firm expects the project to generate cash flows of $2 million, $3 million, $4 million, and $5 million over the next four years. Its cost of capital is 16 percent. What is the net present value of this project

NPV= $777,712.81

Explanation:

Giving the following information:

Initial investment= $8.5 million.

The firm expects the project to generate cash flows of $2 million, $3 million, $4 million, and $5 million over the next four years.

Discount rate= 16%

To calculate the net present value, we need to use the following formula:

NPV= -Io + ∑[Cf/(1+i)^n]

Year 1= 2,000,000/1.16= 1,724,137.93

Year 2= 3,000,000/(1.16^2)= 2,229,488.70

Year 3= 4,000,000/(1.16^3)= 2,562,630.69

Year 4= 5,000,000/(1.16^4)= 2,761,455.49

Total= 9,277,712.81

NPV= -8,500,000 + 9,277,712.81= $777,712.81

c

explanation:

c because the item on a bank statement is also referred to as an account statement. in addition, it provides the beginning balance, ending balance, statement date, transaction date for each transaction, payee, customer name and address, statement period, the account holder's account number, and the bank's customer service number

answer; lags, push the econ below the natural level of output;