Question
Can someone help me solve this with excel! 1. A firm is considering potential investment project that would result in an immediate loss in free
Can someone help me solve this with excel!
1. A firm is considering potential investment project that would result in an immediate loss in free cash flow of $88 Million, but would generate positive free cash flow of $6 Million Next year. The firm expects the free cash flow produced by the project to grow annually at 3% forever. The firm's weighted average cost of capital (WACC) is 6%. What is the NPV of the project (enter your answer in millions of dollars rounded to two decimal places.) Hint: NPV= -FCF0 + FCF1/(WACC-g)
2. What is the payback period for an investment project with an upfront cost of $3,000,000 but benefits of $425,000 a year, each year, forever? Hint: payback period is the amount of time it takes to pay back the initial investment
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