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NPV and EVA: A project costs $2.5 million up front and will generate cash flows in perpetuity f $220,000. The firm's cost of capital is
NPV and EVA: A project costs $2.5 million up front and will generate cash flows in perpetuity f $220,000. The firm's cost of capital is 7%.
A) Calculate the project's NPV
B) Calculate the annual EVA in a typical year.
C) Calculate the overall project EVA and compare to your answer in part A.
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