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If the installation of a new machine will lower the firms required working capital by $50,000, and this amount of networking capital will need to
If the installation of a new machine will lower the firms required working capital by $50,000, and this amount of networking capital will need to be replaced once the machine is sold in year 5. The following will be the impact on the FCF:
Multiple Choice -50,000 in year 0
+50,000 in year 0, and -50,000 in year 5
No change in FCF since both amounts will cancel one another
-50,000 in year 0, and +50,000 in year 5
+50,000 in year 5
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