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Suppose Blue Hamster Manufacturing Inc. is evaluating a proposed capital budgeting project (project Beta) that will require an initial investment of $2, 750,000. The project
Suppose Blue Hamster Manufacturing Inc. is evaluating a proposed capital budgeting project (project Beta) that will require an initial investment of $2, 750,000. The project is expected to generate the following net cash flows: Blue Hamster Manufacturing Inc.'s weighted average cost of capital is 9%, and project Beta has the same risk as the firm's average project. Based on the cash flows, what is project Beta's NPV? -$1, 387, 201 $1, 362, 799 -$912, 201 -$4, 137, 201 Blue Hamster Manufacturing Inc.'s decision to accept or reject project Beta is independent of its decisions on other projects. If the firm follows the NPV method, it should _ project Beta
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