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Q2: Innovation Company is thinking about marketing a new software product. Upfront costs to market and develop the product are S5,200,000. The product is expected
Q2: Innovation Company is thinking about marketing a new software product. Upfront costs to market and develop the product are S5,200,000. The product is expected to generate profits of $1,300,000 per year for ten years. The company will have to provide product support expected to cost $100,000 per year in occur at the end of each year. what is the NPV of this investment if the cost of capital is 5.37%? Should the firm undertake the project? Repeat the analysis for discount rates of 1.46% and 18.51%, respectively. A. B. Given respective cost of capitals, explain why the NPV's came out as such
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