Question
a project is expected to provide a positive cash flow of $14,000 per year for the next 5 years followed by a clean-up cost of
a project is expected to provide a positive cash flow of $14,000 per year for the next 5 years followed by a clean-up cost of 10,000 for year 6. Given the initial cost or dollar outlay today is $50,000, answer the following:
If the wacc = 8%, what is the NPV for the project? (Show your work by providing the inputs and outputs for the financial calculator.)If the wacc = 16%, what is the NPV for the project? At what interest rate, would NPV equal 0? Hint: calculate IRR) (Show your work by providing the inputs and outputs for the financial calculator.)
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