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6.Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of
6.Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistic for the project are three and three and a half years, respectively.
Calculate the NPV and use the NPV technique to evaluate this project; should it be accepted or rejected and why?
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