Neco Model Questions Vol1 2020 Government Question 2
Practice objective / multiple choice question 2 from the 2020 Neco Model Questions Vol1 Government examination.
A government plans a water‑supply project that requires an upfront capital outlay of \(\text{₦}150\) million. The project will incur an annual operating cost of \(\text{₦}5\) million for 10 years and is expected to generate annual benefits of \(\text{₦}25\) million for the same period. Using a discount rate of \(8\%\) per annum, calculate the net present value (NPV) of the project. State whether the project is financially justified (NPV > 0).
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About This Question
This is Neco Model Questions Vol1 2020 Government Question 2. It is one of the objective questions from the 2020 Neco Model Questions Vol1 Government examination.
Difficulty level: Hard .
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