Skyline Music is considering investing $600,000 in private lesson studios that will have no residual value. The

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Skyline Music is considering investing $600,000 in private lesson studios that will have no residual value. The studios are expected to result in annual net cash inflows of $100,000 for the next 10 years. Assuming that Skyline Music uses an 8% hurdle rate, what is the net present value (NPV) of the studio investment? Is this a favourable investment?

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Managerial Accounting

ISBN: 9780135443446

4th Canadian Edition

Authors: Karen Braun, Wendy Tietz, Louis Beaubien

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