Question
Given Scenario C, they decide to SELL THE INVESTMENT in 22 for $420,000 (post-tax). Calculate NPV given the sale, also find the option to abandon
Given Scenario C, they decide to SELL THE INVESTMENT in 22 for $420,000 (post-tax).
Calculate NPV given the sale, also find the option to abandon and state whether the company should proceed with the investment.
| Initial Investment | $650,000 | ||||||||||
| Discount Rate | 9% | ||||||||||
| 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | ||||
| Scenario | Exp. Cash Flow | Prob | NPV | 21 | 22 | 23 | 24 | 25 | 26 | 27 | 28 |
| A | $150,000 | 25% | |||||||||
| B | $130,000 | 45% | |||||||||
| C | $55,000 | 30% | |||||||||
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Financial Management In The Sport Industry
Authors: Matthew T Brown, Daniel Rascher, Mark S Nagel, Chad Mcevoy
1st Edition
1934432040, 978-1934432044
