1. a) What is meant by Net Present Value in relation to investment appraisal? b) The following are net cashflows from three projects, A, B and C, which have an initial investment of £40,000: Using investment appraisal methods with which you are familiar, state which of the projects above you would recommend. Give reason for your answer. (Marks available: 10) Answer Answer outline and marking scheme for question: 1 Give yourself marks for mentioning any of the points below: a) Net present value is the present value of future income from an investment project, less the cost. (5 marks) b) Payback method. B is fastest. Return on investment. A is best. NPV. B is best B is the best choice. (5 marks) (Marks available: 10)