Neco 2020 Data Processing Question 44

Practice objective / multiple choice question 44 from the 2020 Neco Data Processing examination.

Neco 2020 Data Processing Objective / Multiple Choice Hard Difficulty
Question 44 NECO • 2020 • DATA_PROCESSING • objective

A school intends to purchase five computers at a cost of ₦250,000 each. Each computer has an annual maintenance cost equal to 10 % of its purchase price and a useful life of four years with no salvage value. The expected annual benefit from the computers is valued at ₦120,000. Using a discount rate of 12 % per annum, calculate the net present value (NPV) of the project and state whether the investment is financially viable. Also indicate the pay‑back period in years (or state if it exceeds the project life).

Answer Options

A. NPV = ₦210,000; Payback period ≈ 2.2 years (within project life)
Correct Answer B. NPV = ₦191,691; Payback period ≈ 2.6 years (within project life)
C. NPV = ₦95,000; Payback period ≈ 3.1 years (within project life)
D. NPV = ₦-1,250,000; Payback period exceeds project life
Correct Answer
B
Correct Option:
NPV = ₦191,691; Payback period ≈ 2.6 years (within project life)

About This Question

This is Neco 2020 Data Processing Question 44. It is one of the objective questions from the 2020 Neco Data Processing examination.

Difficulty level: Hard .

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