Question
The cash flows and Net salvage value of Project A is given the following table: Year Cash flows Salvage Value 0 -5,800 5,800 1 2,100
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The cash flows and Net salvage value of Project A is given the following table:
| Year | Cash flows | Salvage Value |
| 0 | -5,800 | 5,800 |
| 1 | 2,100 | 2,000 |
| 2 | 1,400 | 1,200 |
| 3 | 1,600 | 800 |
| 4 | 1,800 | 0 |
Given the cost of capital is 10%, Calculate the NPV for its Economic Life and determine what are its economic life and physical life of Project A?
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Principles Of Macroeconomics
Authors: Frank, Bernanke, Antonovics, Heffetz
3rd Edition
1259117162, 9781259117169
