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A company is considering a project that will require a cost outlay of $15 000 per year for four years. At the end of the
A company is considering a project that will require a cost outlay of $15 000 per year for four years. At the end of the project the salvage value will be $10 000. The project will yield returns of $60 000 in Year 4 and $20 000 in Year 5. There are no returns after Year 5. Alternative investments are available that will yield a return of 16%.
Should the company undertake the project?
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