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Please provide written equation used 6. SpaceX has been awarded a contract to build a next generation rocket for NASA. NASA will pay SpaceX $640,000
Please provide written equation used
6. SpaceX has been awarded a contract to build a next generation rocket for NASA. NASA will pay SpaceX $640,000 per year for 18 years (beginning next year) as progress payments. NASA will also pay SpaceX milestone payments of $6,000,000 at the halfway point (after 9 years), and $15,000,000 after completion, with 2 years delay making sure everything works properly (after 20 years). SpaceX will need to make an initial investment of $7,000,000 and will also have costs of $160,000 per year, for 18 years, to cover labor and materials. SpaceX's annual WACC is 13%. What is the NPV of the contract for SpaceX? Should they accept the contract? EatstStep by Step Solution
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