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Initial investment: $ 2,600,000 Annual net income: $ 150,000 Expected life: 8 years Salvage value: $160,000 Cost of capital: 6% (Assume straight line depreciation method
Initial investment: $ 2,600,000
Annual net income: $ 150,000
Expected life: 8 years
Salvage value: $160,000
Cost of capital: 6%
(Assume straight line depreciation method is used)
1. Calculate the project's net present value (NPV)
2. Calculate the net present value (NPV) using an 8% discount rate
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