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A mining operation is expected to cost $15 million and last 12 years. In years 1-10, $6 million per year will be generated. It will
A mining operation is expected to cost $15 million and last 12 years. In years 1-10, $6 million per year will be generated. It will take 2 subsequent years to conduct environmental recovery efforts expected to cost $3.5 million per year. If the discount rate is 22%, should the operation be undertaken. Provide IRR if the assumptions hold, otherwise provide the NPV.
Should the mining operation be undertaken?
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