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Esfandairi Enterprises is considering a new 3 - year expansion project that requires an initial fixed asset investment of $ 2 . 1 8 million.

Esfandairi Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.18 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $1,730,000 in annual sales, with costs of $640,000. The tax rate is 24 percent and the required return is 13 percent. What is the projects NPV?

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