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An existing soft drink line generates annual cash flow of $10,000,000. The company is considering introducing a new soft drink that is projected to generate
An existing soft drink line generates annual cash flow of $10,000,000. The company is considering introducing a new soft drink that is projected to generate $3,000,000 of annual cash flow; however, if the new drink is launched cash flow from the existing drink is expected to decline by $1,000,000 when consumers switch from the old drink to the new one. How much annual cash flow should be included in the Discounted Cash Flow analysis of the new drink? Multiple Choice $2.000.000 $2.500.000 O $3,000,000 O $4,000,000 O O None of the above
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