Wagner plc is considering a project which will generate cash flows of £5,000 each year from years 3 to 7. The company has a cost of capital of 14%. What is the total present value of the cash flows? a)  £21,440 b)  £17,090 c)  £17,165 d)  £13,210

Cornerstones of Cost Management (Cornerstones Series)
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Chapter19: Capital Investment
Section: Chapter Questions
Problem 23E: Assume that an investment of 100,000 produces a net cash flow of 60,000 per year for two years. The...
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Wagner plc is considering a project which will generate cash flows of £5,000 each year from years 3 to 7. The company has a cost of capital of 14%.

What is the total present value of the cash flows?

  1. a)  £21,440

  2. b)  £17,090

  3. c)  £17,165

  4. d)  £13,210 

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