Question
A 4-year project has an initial fixed asset investment of $28,140, an initial NWC investment of $2,680, and an annual OCF of -$42,880. The fixed
A 4-year project has an initial fixed asset investment of $28,140, an initial NWC investment of $2,680, and an annual OCF of -$42,880. The fixed asset is fully depreciated over the life of the project and has no salvage value.
If the required return is 16 percent, what is the project's equivalent annual cost, or EAC?
What is the formula for calculating EAC?
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Introduction To Finance Markets, Investments, And Financial Management
Authors: Ronald W. Melicher, Edgar A. Norton
17th Edition
1119561175, 978-1119561170
