The owners of a chain of fast-food restaurants spend $24 million installing donut makers in all their restaurants. This is expected to increase cash flows by $9 million per year for the next five years. If the discount rate is 5.2%,were the owners correct in making the decision to install donut makers?
A. Yes, as it has a net present value (NPV) of $15 million.
B.No, as it has a net present value (NPV) of −$1 million.
C.No, as it has a net present value (NPV) of −$3 million.
D.Yes, as it has a net present value (NPV) of $9 million.
