Question
Metlock Inc. has a project that requires a $50,100 after-tax initial investment and produces these after-tax cash flows at each year-end: $18,550; $20,700; -$6,200; $41,650;
Metlock Inc. has a project that requires a $50,100 after-tax initial investment and produces these after-tax cash flows at each year-end: $18,550; $20,700; -$6,200; $41,650; $59,400; and $22,400. The appropriate domestic discount rate is 23.7 percent. The project is in another developing country, where extra risk is assumed to be 5.9 percent. Calculate the project's NPV. Should Metlock Inc. accept or reject the project? (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 2 decimal places e.g. 971.25.)
NPV = ___ $
Metlock Inc. should ___ the project.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started