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Posting for the 3 rd time can someone do it corrrectly? The existence of options can - select - projects' expected profitability, - - select

Posting for the 3rd time can someone do it corrrectly?
The existence of options can -select- projects' expected profitability, --select-vv their calculated NPVs, and --select- their risk. accounted for in a traditional NPV analysis and a positive option yalue expands the firm's opportunities. the proposed project, which is expected to last 3 years:
The project can be operated at the company's Charleston plant, which is currently vacant. company plans to use the equipment for all 3 years of the project. At t=3(which is the project's last year of operation), the equipment is expected to be sold for $1,450,000 before taxes.
The project will require an increase in net operating working capital of $730,000 at t=0. The cost of the working capital will be fully recovered at t=3(which is the project's last year of operation).
Expected high-protein energy smoothie sales are as follows:
Year Sales
1$2,600,000
27,400,000
3,3,800,000
The project's annual operating costs (excluding depreciation) are expected to be 60% of sales.
The company's tax rate is 25%. credits related to this project they can be used in the year they occur.)
The project has a WACC=10.0%.
What is the project's expected NPV and IRR? Round your answers to 2 decimal places. Do not round your intermediate calculations.
NPV ,$
IRR %
Should the firm accept the project?
-Selectdollars" to ascertain the answer.
nillions of dollars
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