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Small Effect Corp is considering investing $70 million in a new factory that will generate net monthly cash flows beginning four months from today. The
Small Effect Corp is considering investing $70 million in a new factory that will generate net monthly cash flows beginning four months from today. The first cash flow will equal $2 million and subsequent cash flows will shrink by 1% each through the final cash flow which will occur four years and 1 month from today. The projects cost of capital equals 12.5% per year. Set up the calculations needed to determine the net present value of factory.
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