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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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