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Question 16 (CHAPTER 10) Your company's boss asked you to estimate the cash flows relevant to a new investment project. In particular, he wants you
Question 16 (CHAPTER 10) Your company's boss asked you to estimate the cash flows relevant to a new investment project. In particular, he wants you to focus on Net Working Capital and how it may need to be adjusted for each year of the proposed project. Here's the summary of your estimates: If accepted, the 3-year project would require an immediate investment of $40,000 into the Net Working Capital (NWC). It would be necessary to increase the Net Working Capital by $2,000 in each subsequent year of the project. You then summarized the results for your boss as follows: (Fill it out! Pay attention to the signs! A "_" sign indicates a cash outflow for the company, while no sign indicates a cash inflow.) Change in NWC in Year 0: Change in NWC in Year 1: Change in NWC in Year 2: Change in NWC in Year 3
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