what is the net present value of the first investment? what is the net present value of the second investment? being mutually exclusive, which investment should angie choose

Respuesta :

The present value of each cash flow over the course of the project is used to determine net present value, or NPV. Following that, the initial investment in the investment is reduced by the present value of the cash flows.

What exactly is the investment NPV rule?

The net present value rule states that business executives and investors should only fund initiatives or conduct deals that have a net present value that is in their favor (NPV). A negative net present value project should not be one in which they invest.

Is the initial investment subtracted while calculating NPV?

All of your anticipated returns will be valued at that amount in the present. To determine the NPV, you first take that amount and remove your initial investment from it. The project will not be successful if the NPV is negative.

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