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Blossom Corporation is considering adding a new product line. The cost of the factory and equipment to produce this product is $1,700,000. Company management expects
Blossom Corporation is considering adding a new product line. The cost of the factory and equipment to produce this product is $1,700,000. Company management expects net cash flows from the sale of this product to be $480,000 in each of the next eight years.
If Blossom uses a discount rate of 12 percent for projects like this, what is the net present value of this project?
What is the internal rate of return?
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