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#11 is the only answer necessary Calculating Project OCF Esfandairi Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment
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Calculating Project OCF Esfandairi Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.18 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $1.645 million in annual sales, with costs of $610,000. If the tax rate is 21 percent, what is the OCF for this project? Calculating Project NPV In the previous problem, suppose the required return on the project is 12 percent. What is the project's NPV? Calculating Project Cash Flow from Assets In the previous problem, suppose the project requires an initial investment in net working capital of $250,000, and the fixed asset will have a market value of $180,000 at the end of the project. What is the project's Year 0 net cash flow? Year 1? Year 2? Year 3 ? What is the new NPVStep by Step Solution
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