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Question 3 10 pts You are evaluating a new product expected to generate cash inflows of $3,693 annually for five years, starting one year from
Question 3 10 pts You are evaluating a new product expected to generate cash inflows of $3,693 annually for five years, starting one year from now. In year six, the project will end and will provide a final cash flow of $7,690. The project requires an investment of $13,891 today. What is the net present value of this project if the required rate of return is 8.1 percent? Round your answer to two decimal places, and omit dollar signs (i.e., enter $2,001.274 as 2,001.27). Question 4 10 pts You have been provided with the following information for Year 2 of your capital budgeting analysis: Incremental Gross Profit (before depreciation) $6,533 Depreciation expense $824 Fixed overhead allocation $729 Tax rate 32% The fixed overhead allocation of $729 to be charged to this project is a portion of the cost of maintaining the corporate headquarters. Assuming no additional effects, what do you forecast for incremental free cash flow for Year 2? Round your answer to two decimal places and enter it without any symbols, e.g. -$23,215.17 should be entered as -23,215.17
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