Question
A company plans to launch a new product with the following estimated cash flows: Year Cash Flow 0 -$15,000 1 $3,000 2 $6,000 3 $9,000
A company plans to launch a new product with the following estimated cash flows:
Year | Cash Flow |
0 | -$15,000 |
1 | $3,000 |
2 | $6,000 |
3 | $9,000 |
4 | $12,000 |
Requirements: a) Calculate the NPV if the discount rate is 7%. b) Calculate the IRR. c) Determine the payback period. d) Should the company proceed with the product launch?
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Managerial Accounting
Authors: Stacey Whitecotton, Robert Libby, Fred Phillips
3rd edition
77826485, 978-0077722074, 77722078, 978-0077826482
