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the other option below bonus for the last one is straight line Part 4 of the question (couldnt fit on photo) 4: No other firm
the other option below bonus for the last one is straight line
Part 4 of the question (couldnt fit on photo)
4: No other firm would take on this project if McPhan turns it down. Which of the following most close the approximates, how much McPhan should reduce the NPV of this project, assuming it is discovered that this project would reduce one of its divisions, net after tax cash flows by $400 for each year of the four-year project?
a)$1,054.83
b)$1,240.98
c)$1,365.08
d) $744.59
Part 5 of the question (couldnt fit on photo)
5: The project require an initial investment of $15,000, but the project will also be using a company on the truck that is not currently being used. This truck could be sold for $14,000, after taxes, at the project is rejected. What should McFann do to take this information into account?
a) Increase the NPV of the project by $14,000
b) The company does not need to do anyrhing with the value of the truck because the truck is a sunk cost.
c) Increase the amount of the initial investment by $14,000
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