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Big Bang Plc . considers a new investing project for 4 years. To decide which market to target, the firms also paid $ 1 0
Big Bang Plc considers a new investing project for years. To decide which market to target, the firms also paid $ to Think Big, a consultancy firm. This project requires an initial investment in working machine of $ The machine is supposed to be fully depreciated over the life of the project years using straight line method. The company expects to sell the machine at the end of the th year for of its initial value but would have to pay $ for deconstructing service. Big Bang plc forecasts revenues in the first year of $ and the revenues increase by every year. The operating costs constitute of revenues. The working capital required in each year is expected to be of revenues in the following year. Required rate of return is
Required: Compute the NPV IRR of the project and make investment recommendation.
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