Some investment projects require that a company increase its working capital.Under the net present value method, the investment and eventual recovery of working capital should be treated as:

A) an initial cash outflow.
B) a future cash inflow.
C) both an initial cash outflow and a future cash inflow.
D) irrelevant to the net present value analysis.

When a company invests in a project that requires an increase in its working capital, it may need to spend additional cash to support the project's operations. This initial cash outflow should be considered as part of the project's total cost under the net present value method.

On the other hand, when the project is completed, it may generate additional cash inflows that can be used to recover some or all of the working capital that was initially invested. These future cash inflows should be included in the net present value analysis as part of the project's total benefits.

Therefore, both an initial cash outflow and a future cash inflow should be treated as part of the net present value analysis when evaluating investment projects that require an increase in working capital.