Question
IN Oventions Putni anaing age-rik project, and the following data have been developed. Unit sales will be constant, but the sales price should in
IN Oventions Putni anaing age-rik project, and the following data have been developed. Unit sales will be constant, but the sales price should in Fied will be bestant, but variable costs should rise with inflation. The project should last for 3 years. Under the new tax project is eligible for 100% bonus depreciation, so it will be fully depreciated at t-o. At the end of the project's life, the gee. No change in net operating working capital (NOWC) would be required for the project. This is just one of many this project can be used to offset gains on other firm projects. The marketing manager does not think it is necessary to fationer both the sales price and the variable costs will rise at the same rate, but the CFO thinks an inflation adjustment is required. What is NPV the inflation adjustment is made versus if it is not made? Do not round the intermediate calculations and round the have firm any whole number 10.0% $215,000 45,000 per unit Year 1 $20.00 Top cost $150,000 " variable as count Your $14.40 N Expected annual inflation rate 5.00% 9 Tax rate 25.0% N 000 AMS 015577 020
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