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East Coast Enterprises is considering a new three - year expansion project that requires an initial fixed asset investment of $ 2 . 1 8
East Coast Enterprises is considering a new threeyear expansion project that requires an initial fixed asset investment of $ million. The fixed asset will be depreciated straightline to zero over its threeyear tax life. The project is estimated to generate EBIT of $ There is no interest expense. Operating Cash Flow remains constant throughout the project. The project requires an initial investment in net working capital of $ which will be recovered at the end of the project. The fixed asset will have a market value of $ at the end of the project. The tax rate is percent. The required return or discount rate is percent.
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