Question
3. Epsilon Corp. is evaluating an expansion of its business. The cash-flow forecasts for the project are as follows: Year Cash Flow ($ millions) 0
3. Epsilon Corp. is evaluating an expansion of its business. The cash-flow forecasts for the project are as follows: Year Cash Flow ($ millions) 0 -100 1 10 +15
The firms existing assets have a beta of 1.4. The risk-free interest rate is 4% and the expected return on the market portfolio is 12%. What is the projects NPV?
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International Financial Reporting A Practical Guide
Authors: Alan Melville
6th edition
1292200743, 1292200766, 9781292200767, 978-1292200743
