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Temple Corp. is considering a new project whose data are shown below. The equipment that would be used for 4-year, would be depreciated by the
Temple Corp. is considering a new project whose data are shown below. The equipment that would be used for 4-year, would be depreciated by the straight-line method over its 4-year life. Revenues and other operating costs are expected to be constant over the project's life. What is the project's NPV?
WACC 10%
Equipment cost $110,000
Shipping and Installation cost $10,000
Increase in NOWC $15,000 Salvage value $20,000
Sales, each year $70,000
Operating costs (excluding depreciation) $20,000
Tax rate 40%
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