CIMA Risk Management P3 Question # 49 Topic 5 Discussion

CIMA Risk Management P3 Question # 49 Topic 5 Discussion

P3 Exam Topic 5 Question 49 Discussion:
Question #: 49
Topic #: 5

A project has been evaluated on the basis that it will cost $22 million and will have a net present value of $4.3 million The project has commenced and $5 million of the $22 million has been invested. A problem has been discovered that will cost an additional $4.5 million to rectify. The $4.5 million will be payable immediately. What is the NPV of continuing with this project?


A.

-$5million


B.

-$0.2million


C.

$1million


D.

$4.8million


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