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Can you please answer all of part A. Show work please and thanks in advance. CAPITAL BUDGETING CRITERIA: ETHICAL CONSIDERATIONS A mining company is considering
Can you please answer all of part A. Show work please and thanks in advance.
CAPITAL BUDGETING CRITERIA: ETHICAL CONSIDERATIONS A mining company is considering a new project. Because the mine has received a permit, the project would be legal; but it would cause significant harm to a nearby river. The could spend an additional $10 million at Year o to mitigate the environmental Problem, but it would not be required to do so. Developing the mine (without mitigation would cost 560 million, and the expected cash inflows would be $20 million per year for 5 years. If the firm does invest in mitigation, the annual inflows would be 521 million. The risk-adjusted WACE is 13% a. Calculate the NPV and IRR with mitigation. Round your answers to two decimal places. Do not round your intermediate calculations. Enter your answer for NPV in millions for example, an answer of $10,550,000 should be entered as 10.55. NPV S * million IRR ons. For Calculate the NPV and IRR without mitigation. Round your answers to two decimal places. Do not round your intermediate calculations. Enter your answer for Nevin m example, an answer of $10,550.000 should be entered as 10.55. NPV $ 3 million IRR * % b. How should the environmental effects be dealt with when this project is evaluated? m ult in additional cash flows. Therefore, since the mine is legal without mitigation, there are no benefits to performing ahe
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