Question
(a) What's the NPV of a project with these cash flows for a company that has an 8% WACC? Initial investment = -$1.1M Year 1
(a) What's the NPV of a project with these cash flows for a company that has an 8% WACC?
Initial investment = -$1.1M
Year 1 = -$100K
Year 2 = +$500K
Year 3 = +$700K
Year 4 = +$900K
Year 5 = -$100K (repairs needed this year resulted in a net cash outflow)
Year 6 = +$500K
Year 7 = +$700K
Year 8 = +$900K
(b) What's the IRR on this project
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International Financial Management
Authors: Cheol Eun, Bruce Resnick
5thEdition
0073382345, 9780073382340
