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The firm is contemplating to launch a new product with an investment of $100 million for 5 years. If the new product is expected to
The firm is contemplating to launch a new product with an investment of $100 million for 5 years. If the new product is expected to generate cash flow $32 million in the first year and grows $2.5 million each year for next 4 years, what is the NPV of the product at 11% cost of capital? Also find the IRR of the project and decide whether to accept the project or not?
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