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Your company is considering launching a new line of stoves. The manufacturing plant required for producing the new line of stoves costs $ 6 ,
Your company is considering launching a new
line of stoves. The manufacturing plant required for producing the new line of stoves
costs $today and will be depreciated down to zero over years using
straightline depreciation. The manufacturing plant will be sold for $ at the
end of years the life of the project is years Net working capital increases by
$ at the beginning of the project year and it is reduced back to its
original level in the final year of the project. The tax rate is percent and the
discounting rate for the project is What is the initial outlay Cash flow todayfor
this project?
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