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1. Your firm has a potential project that will cost $5,000 now to begin. The project will then generate after-tax cash flows of $271 at
1. Your firm has a potential project that will cost $5,000 now to begin. The project will then generate after-tax cash flows of $271 at the end of the next three years and then $1,173 per year for the three years after that. If the discount rate is 4.6% then what is the NPV?
True/False:
2. The Internal Rate of Return (IRR) is the discount rate that equates the NPV of an investment opportunity with $0
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