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The GreatOreCo mining company wishes to determine whether it should proceed to develop a copper mine for a lease that it owns. There would be

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The GreatOreCo mining company wishes to determine whether it should proceed to develop a copper mine for a lease that it owns. There would be substantial development costs involved, and the mine would be expected to have a life span of nine years. The company would also be faced with environmental rehabilitation costs when the mine is closed down, and this is reflected by a smaller contribution in the mine's final year of operation. Projected costs and yields have been determined and the resulting cash flows are summarised in the table below: Set Up Costs (5 Profit Contribution million) from mine operation (5 million)

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