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A firm is contemplating starting a project that will require an investment amount of $ 5 0 0 K today. The project s future cash
A firm is contemplating starting a project that will require an investment amount of $K today. The projects future cash flows are estimated to be: $K $KKK in years respectively.
a If the WACC what is the NPV
b Should the firm accept or reject this project?
c What is the firms IRR?
d What is the firms payback period if WACC
e What is the firms discounted payback period if WACC
f Draw sketch the NPV profile of this project, clearly labeling the axis intercepts.
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