Question
You can buy a factory for $50,000 that will produce $8,000 in net sales (sales - costs) at the end of each year for 10
You can buy a factory for $50,000 that will produce $8,000 in net sales (sales - costs) at the
end of each year for 10 years. The factory depreciates to zero over 25 years. You think you can
sell the factory for $15,000 after 10 years. There are no NWC requirements. Tax rate is 35%. If
annual interest rate is 8%, what is NPV of the factory? Should you take the project?
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Personal Finance
Authors: Vickie L Bajtelsmit
2nd Edition
111959247X, 9781119592471
