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ABC Corporation is considering a project with the following projected numbers: Initial investment to purchase equipment...

ABC Corporation is considering a project with the following projected numbers: Initial investment to purchase equipment $260,000 Net working capital investment $16,500 Depreciate equipment to zero book value over the 4 year life of the project Estimated salvage value of the equipment is $50,000 at the end of the project All of net working capital recouped at end of the project $82,000 per year operating cash flow 12 percent discount rate. What is the NPV of the project if the tax rate is 21 percent? $15,684.29 $9,670.33 −$15,432.63 $16,343.27

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Answer #1

With the numbers provided, NPV is $8,151.66, not any of the given options.

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