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You are asked to evaluate the following project for a corporation profitable ongoing operations. The required investment on January 1 of this year is $
You are asked to evaluate the following project for a corporation profitable ongoing operations. The required investment on January of this year is $ The firm will depreciate the investment at a CCA rate of percent. The firm is in the percent tax bracket.
The price of the product on January year is $ per unit. That price will stay constant in real terms. Labour costs is $ per hour on January year Labour costs will increase by percent per year in real terms after year Energy costs will be $ per physical unit on January year ; energy cost will increase at percent per year in real terms after year The inflation rate is percent. The company sells all of its production in the year produced; revenue is received and costs are paid at yearend:
Year Year Year Year
Physical production, in units
Labour input, in hours
Energy input, physical units
The riskfree nominal discount rate is percent. The real discount rate for costs and revenues is percent. Calculate the NPV of this project. Do not round intermediate calculations. Round the answer to decimal places. Negative amount should be indicated by a minus sign. Omit $ sign in your response.
Net present value $
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