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Question 7: Brother Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.16 million. The fixed asset will

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Question 7: Brother Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.16 million. The fixed asset will be depreciated straight-line to zero over its 3 -year tax life, after which time it will have a market value of $168,000. The project requires an initial investment in net working capital of $240,000. The project is estimated to generate $1,920,000 in annual sales, with costs of $768,000. The tax rate is 24 percent and the required return on the project is 12 percent. What is the NPV? A. $379.595 B. 240,000 C. 1,048,320 D. 1,416,00

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