Question
11.7 Apply WACC in NPV . Brawn Blenders has the following incremental cash flow for its new project: Category T 0 T 1 T 2
11.7
Apply WACC in
NPV.
Brawn Blenders has the following incremental cash flow for its new project:
| Category | T0 | T1 | T2 | T3 | ||
| Investment | $3,565,000 | |||||
| Net working capital change | $281,000 | $281,000 | ||||
| Operating cash flow | $1,182,000 | $1,182,000 | $1,182,000 | |||
| Salvage | $269,000 | |||||
Should Brawn accept or reject this project at an adjusted WACC of
a. 8.11%,
b. 10.11%,
c. 12.11%?
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Public Finance
Authors: John E. Anderson
2nd edition
978-0538478441, 538478446, 978-1133708360, 1133708366, 978-1111526986
