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A proposed nuclear power plant will cost $1.9 billion to build and then will produce cash flows of $270 million a year for 15 years.
A proposed nuclear power plant will cost $1.9 billion to build and then will produce cash flows of $270 million a year for 15 years. After that period (in year 15), it must be decommissioned at a cost of $870 million. What is project NPV if the discount rate is 4%? What if it is 18%? (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers in billions rounded to 3 decimal places.) |
Discount Rate | NPV |
4% | $ billion |
18% | billion |
|
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