PK0-005 Project Management Concepts Practice Question
A company is considering a project with an initial investment of $100,000 and expected annual cash inflows of $30,000 for 5 years. The discount rate is 10%. What is the approximate Net Present Value (NPV)? (Present value of annuity factor for 5 years at 10% is 3.791)
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
$13,730
NPV = Present value of inflows - Initial investment. PV of inflows = $30,000 * 3.791 = $113,730. NPV = $113,730 - $100,000 = $13,730.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$50,000
Why it's wrong here
That is the sum of undiscounted inflows, not NPV.
- ✗
-$13,730
Why it's wrong here
The calculation gives positive NPV.
- ✗
$150,000
Why it's wrong here
That is total undiscounted inflows.
- ✓
$13,730
Why this is correct
Correct. $30,000 * 3.791 = $113,730; $113,730 - $100,000 = $13,730.
Go deeper
Related to this question
About these practice questions
This PK0-005 question is part of Courseiva's 980-question bank — original exam-style content with full explanations and wrong-answer analysis, never real exam questions or exam dumps. Learn why practice questions differ from exam dumps →
JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This PK0-005 practice question is part of Courseiva's free CompTIA certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the PK0-005 exam.