CPA · Question 11 · Area I: Business Analysis

Project Alpha requires an initial investment of $100,000. It is expected to generate net cash inflows of $40,000 at the end of Year 1, $40,000 at the end of Year 2, and $50,000 at the end of Year 3. The company's required rate of return is 10%.<br/><br/>Discount factors for 10%: Year 1 (0.909), Year 2 (0.826), Year 3 (0.751).<br/><br/>What is the Net Present Value (NPV) of the project?