Question
You are planning to invest $15,000 in research & development (R&D). This investment will generate cost savings of $10,500 in year 1 and $7,500 in
a) Compute the net present value. Should you invest?
b) Following a government stimulus program, the cost of capital decreased to 10% a year. Compute the net present value at the new cost of capital.
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
12th edition
978-0324597714, 324597711, 324597703, 978-8131518571, 8131518574, 978-0324597707
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