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Project D costs $7,000 and will generate sales of $4,700 each year for 5 years. The cash expenditures will be $1,850 per year. The firm
Project D costs $7,000 and will generate sales of $4,700 each year for 5 years. The cash expenditures will be $1,850 per year. The firm uses straight-line depreciation with an estimated salvage value of $400 and has a tax rate of 30%.
What is the NPV of project D? Assume that the firm requires a minimum after-tax return of 6% on investment.
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