Question
The cash flows and Net salvage value of Project X is given the following table: Year Cash flows Salvage Value 0 -5,800 4,800 1 2,100
The cash flows and Net salvage value of Project X is given the following table:
| Year | Cash flows | Salvage Value |
| 0 | -5,800 | 4,800 |
| 1 | 2,100 | 3,000 |
| 2 | 3,400 | 2,200 |
| 3 | 3,600 | 1,800 |
| 4 | 1,800 | 0 |
Based on the Economic Life of this project and the cost of capital is 12%, in what year should you abandoning this Project X?
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Trading Financial Derivatives
Authors: Kas Salazar ,Gunter Meissner
1st Edition
0536008280, 978-0536008282
