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Problem 10.20 Archer Daniels Midland Company is considering buying a new farm that it plans to operate for 10 years. The farm will require an

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Problem 10.20 Archer Daniels Midland Company is considering buying a new farm that it plans to operate for 10 years. The farm will require an initial investment of $12.2 million. This investment will consist of $2.1 million for land and $10.10 million for trucks and other equipment. The land, all trucks, and all other equipment are expected to be sold at the end of 10 years for a price of $5.2 million, which is $2.0 million above book value. The farm is expected to produce revenue of $2.01 million each year, and annual cash flow from operations equals $1.90 million. The marginal tax rate is 35 percent, and the appropriate discount rate is 10 percent. Calculate the NPV of this investment. (Round intermediate calculations to 4 decimal palces, e.g. 0.5275 and final answer to 2 decimal places, e.g. 15.25.) NPV S The project should be Click if you would like to Show Work for this question: Open Show Work

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