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Solve clearly Q (2) A water utility company is considering an investment project for a new water treatment plant. The cost of buying for the
Solve clearly
Q (2) A water utility company is considering an investment project for a new water treatment plant. The cost of buying for the new treatment plant will be $1500. The future inflows of cash expected from the project are $650 at Year 1, Year 2 and Year 3. The given interest rate for the company is only 5 percent. 1. Calculate the NPV of the project and decide whether the company should go ahead and invest. 2. Why use NPV as the tool to derive the decision aboveStep by Step Solution
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