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Club Corp is evaluating a 3 - year project that would involve buying a new piece of equipment for $ 4 8 0 , 0

Club Corp is evaluating a 3-year project that would involve buying a new piece of equipment for $480,000 today. The equipment would be depreclated straight-line to $120,000 over 2 years. In 3 years, the equipment would be sold for an after-tax cash flow of $75,000. In each of the 3 years of the project, relevant revenues are expected to be $520,000 and relevant costs are expected to be $180,000. The tax rate is 50% and the cost of capital for the project is 17.90%. What is the NPV of the project?

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