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OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship will cost $ 400 million. OpenSeas expects annual cash flows from the

OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship will cost $ 400 million. OpenSeas expects annual cash flows from the new ship to be $ 70 million and these cash flow will last FOREVER. The cost of capital is 16%.

1.What is the NPV of the project?

....?.... millions

2. What is the IRR of the new ship?

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