Question
Mardi Gras Costumes Co. wants to invest in new costumes to rent for next years Mardi Gras Parade. What is the NPV of buying new
Mardi Gras Costumes Co. wants to invest in new costumes to rent for next years Mardi Gras Parade. What is the NPV of buying new costumes, if the firm's WACC is 12% and cash flows are estimated as follows:
| Year | 0 | 1 | 2 | 3 | 4 |
| Cash flows | -$1,200 | $400 | $425 | $450 | $475 |
| a. | $119.30 | |
| b. | $118.12 | |
| c. | $113.40 | |
| d. | $135.84 | |
| e. | $121.67 |
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Corporate Finance Leasing
Authors: Brian Coyle
1st Edition
0852974620, 9780852974629
