Waec Model Questions Vol1 2018 Government Question 8
Practice objective / multiple choice question 8 from the 2018 Waec Model Questions Vol1 Government examination.
A local government intends to implement a water‑supply project. The project requires an initial capital outlay of N10 million. It will incur annual operation and maintenance (O&M) costs of N1.2 million for each of the next 5 years and is expected to generate annual revenue of N2 million for the same 5‑year period. Assuming a discount rate of 8 % per annum, calculate the net present value (NPV) of the project. Round the NPV to two decimal places (in million Naira) and state whether the project should be undertaken (NPV > 0).
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About This Question
This is Waec Model Questions Vol1 2018 Government Question 8. It is one of the objective questions from the 2018 Waec Model Questions Vol1 Government examination.
Difficulty level: Hard .
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