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EduPro Ltd. is considering a new online platform costing $450,000 with a useful life of 6 years and no residual value. It will be depreciated
EduPro Ltd. is considering a new online platform costing $450,000 with a useful life of 6 years and no residual value. It will be depreciated using the straight-line method. Additional working capital of $55,000 is required, recoverable at the end of year 6. The company’s discount rate is 12%.
Cash Flows:
- Year 1: $90,000
- Year 2: $110,000
- Year 3: $130,000
- Year 4: $150,000
- Year 5: $170,000
- Year 6: $190,000
Requirements:
- Calculate the Payback Period.
- Compute the NPV.
- Determine the IRR.
- Calculate the PI.
- Assess if the investment is feasible based on the financial metrics.
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