Question
A retailer is looking to expand operations at all of their stores for an initial investment of $ 840 . This investment will be depreciated
A retailer is looking to expand operations at all of their stores for an initial investment of $840. This investment will be depreciated on a straight line basis over the project's 10 year life. The expansion is expected to produce annual cash inflows of $540 in consecutive years over the life of the project beginning one year from today, while also producing annual cash outflows of $330 in consecutive years over the life of the project, also beginning one year from today. What is the project's NPV if the corporate tax rate is 32% and the project's required rate of return is 15%?
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