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Answer needs to be rounded 3 decimals. Help really appreciated. Thank you all so much!!!!!! You are considering constructing a new plant in a remote
Answer needs to be rounded 3 decimals. Help really appreciated. Thank you all so much!!!!!!
You are considering constructing a new plant in a remote wilderness area to process the ore from a planned mining operation. You anticipate that the plant will take a year to build and cost $99 million upfront. Once built, it will generate cash flows of $13 million at the end of every year over the life of the plant. The plant will be useless 20 years after its completion once the mine runs out of ore. At that point you expect to pay $161 million to shut the plant down and restore the area to its pristine state Using a cost of capital of 12% a. What is the NPV of the project? b. Is using the IRR rule reliable for this project? Explain. c. What are the IRRs of this projectStep by Step Solution
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