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The firm invested in the capital assets to expand its manufacturing capacity. Assume that these assets have a 10 year life, and that the firm
The firm invested in the capital assets to expand its manufacturing capacity. Assume that these assets have a 10 year life, and that the firm requires a 10% internal rate of return on these assets. What is the amount of cash flows that the firm must earn on this new project? The amount that the firm invested in capital assets for the most recent year is 1086 million dollars Assume that the cost of capital required in the new project is 8%. Calculate the discounted payback period. Evaluate whether the decision of investing in the project is correct or not by using net present value
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