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Question 4 Marks) Refer to Questions 2 and 3. The land for the factory will cost $1,080,000 The factory will cost $1.070,000 to build and

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Question 4 Marks) Refer to Questions 2 and 3. The land for the factory will cost $1,080,000 The factory will cost $1.070,000 to build and construction will take two years with construction costs payable in equal installments at the start of each year. The factory will operate for 20 years. At the end of its 20 year lifespan. the land can be resold for $700,000 There is a 70% probability that the factory's net operating cash flows will be $254,556 : however, there is a 30% chance that net cash flows will only be To $85,469 . You may assume that net operating cash flows are received at the end of each year. a) What are the Expected net operating cash flows per year? (Mark Round your answer to 2 decimal places) 15 b) What is the Internal Rate of Return for the project? (1 Mark Round your answer to one one hundroth of a percent) What is the Net Present Value of the project? Mar Round your answer to 2 decimal places) d) Should Anna recommend that the Corporation build the factory? (2 Man) 2 Enter Answer 14 Enter Answer Enter Answer 19 Yes No Check only one box Compte outfbuch work in the space Dolow En your Final Home 25 26

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