Question
A retailer is looking to expand operations at all of their stores for an initial investment of $640. This investment will be depreciated on a
A retailer is looking to expand operations at all of their stores for an initial investment of $640. This investment will be depreciated on a straight line basis over the project's 8 year life. The expansion is expected to produce annual cash inflows of $570 in consecutive years over the life of the project beginning one year from today, while also producing annual cash outflows of $390 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 36% and the project's required rate of return is 15%? $
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