ithou Homework: Cha... Question 9, P13-17 (simi... HW Score: 77.5%, 15.6 of 20 points Part 2 of 2 @ Points: 1 of 2 Save Working capital and capital budgeding. Farbuck's Tea Shops is thinking about opening another ben shop. The incremental cash flow (not including the working capital investment) for the first five years is as follows: Click on the icon in order to copy its content into a spreadsheet Initial capital cost $3,500,000 Operating cash flow for each year = $1,000,000 Recovery of capital assets after five years - $260,000 The hurdle rate for this project is 11%. If the initial cost of working capital is $490,000 for tems such as teapots, teacups, saucers, and napkins, should Farbuck's open this new shop it it will be in business for only five years? What is the most it can invest in working capital and still have a positive net present valun? Should Farbuck's open this new shop if it will be in business for only five years? (Select the best response.) O A Yes. Farbuck's should open the new shop because the project's NPV is $143,437 2. No. Farbuck's should not open the new shop because the project's NPV is - $143,437. OG No. Farbuck's should not open the new shop because the project's NPV 18 - $150,986 D. Yes. Farbuck's should open the new shop because the project's NPV is $150,886. What is the most it can invest in working capital and still have a positive net present value? $ 861,384 (Round to the nearest dollar) You answered: 67.970.78 Correct answer: 861,384 to 801,384 answer tolerance + 66.138) Help me solve this View an example Get more help Similar