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Garida Co. is considering an investment that will have the following sales, variable costs, and fixed operating costs: This project will require an investment of
Garida Co. is considering an investment that will have the following sales, variable costs, and fixed operating costs: This project will require an investment of $20,000 in new Determine what the project's net present value (NPV) equipment. The equipment will have no salvage value at would be when using accelerated depreciation. the end of the project's four-year life. Farida pays a $35, 762 constant tax rate of 40%, and it has a weighted average $45, 696 cost of capital (WACC) of 11%. Determine what the $39, 736 project's net present value (NPV) would be when using_$47, 683 accelerated depreciation. Now determine what the project's NPV would be when using straight-line depreciation. No other firm would take on this project if Galina turns it down. How much should Galina reduce the NPV of this project if it discovered that this project would reduce one of its division's net after-tax cash flows by $600 for each year of the four-year project
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