Using the Net Present Value (NPV) you have obtained for this project at 1 January 2026, with a required return of 5%, what should you conclude?

Using your previous results for:

- the present value of the revenues in 2026,

- the present value of the revenues from 2027 to 2035,

- the present value of the revenues from 2036 onward, and

- the present value of all maintenance costs,

and considering an initial investment of €50,000 at 1 January 2026, compute the Net Present Value (NPV) of the project at 1 January 2026.

Give your answer in euros, rounded to the nearest euro.

The first maintenance cost is €38,000 on 30 June 2026, and from then on the project incurs maintenance costs every six months, each one being 1.5% higher than the previous one, indefinitely. Assume that the required return is 5% per year, and that you work with a semiannual discount rate of i_6m = 5%/2.

Treat this sequence of payments as a growing perpetuity with semiannual payments. Compute the present value at 1 January 2026 of all future maintenance costs.

Give your answer in euros, rounded to the nearest euro.

From 2036 onward, the project generates annual revenues paid at year-end, starting with a = 140,000 € in 2036 and growing at a constant rate g = 2% per year forever. The required return is r = 5%.

Which of the following expressions is correct for the present value at 1 January 2026 of these revenues?

Between 2027 and 2035, the project generates bimonthly revenues that are 4% higher each year than in the previous year. For valuation purposes, you approximate each year’s six bimonthly payments by a single annual payment at year-end equal to that year’s total.

How should this block of cash flows (from 2027 to 2035) be modeled in order to obtain its present value at 1 January 2026?

In 2026, the project generates six bimonthly revenues of €15,000, paid at the end of every two-month period (February, April, June, August, October and December 2026).

Model these six payments as an ordinary bimonthly annuity, and use a 2-month discount rate of r_2m = 5%/6.

Compute the present value at 1 January 2026 of the revenues in 2026.

Give your answer in euros, rounded to the nearest euro.

To decide whether to accept or reject this investment project, given all expected cash flows and a required return of 5% which is the most appropriate decision criterion to use?