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An 8-year long project requires an initial investment of $1.2 million. Assuming a selling price of $1,600 per unit, a variable cost of $700 per
An 8-year long project requires an initial investment of $1.2 million. Assuming a selling price of $1,600 per unit, a variable cost of $700 per unit and fixed costs each year is 600,000. Calculate the NPV if the company expected sales level is 750 units. Assume that the cost of capital is 14%.
a. | -$557,311 | |
b. | -$852,085 | |
c. | $428,750 | |
d. | $651,569 |
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