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You are a consultant to a large manufacturing corporation that is considering a project with the following net after-tax cash flows (in millions of dollars):

You are a consultant to a large manufacturing corporation that is considering a project with the following net after-tax cash flows (in millions of dollars):

Years from now After-tax cash flow
0 -100
1-10 18

The project's beta is 1.12. Assuming that the riks-free rate is 5% and the market expected return is 9.8% what is the net present value of the project? What is the highest possible beta estimate for the project before its NPV becomes negative?

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