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Spiderman Corp is deciding whether to expand its production facilities. Although long term cash flows are difficult to estimate, management has projected the following cash
Spiderman Corp is deciding whether to expand its production facilities. Although long term cash flows are difficult to estimate, management has projected the following cash flows for the first year (in millions of dollars):
| Year 1 |
Revenues | 125 |
Costs of Goods Sold | 20 |
Other Operating Expenses Other Than Depreciation | 20 |
Depreciation | 25 |
Increase in operating working capital | 5 |
Capital expenditures | 30 |
Marginal corporate tax rate | 35% |
What is the projected free cash flows for this project for the first year?
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