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X company provides specialty manufacturing services to defence contractors located in the Seattle, WA area. The initial outlay is $4 million and, management estimates that
X company provides specialty manufacturing services to defence contractors located in the Seattle, WA area. The initial outlay is $4 million and, management estimates that the firm might generate cash flows for years one through five equal to $800,000; $750,000; $1,000,000; $1,900,000; and $2,000,000. Saber uses a 20% discount rate for projects of this type.
Is this a good investment opportunity?
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