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Your company is considering taking on a new project that will cost $ 2 0 0 , 0 0 0 . It is estimated that
Your company is considering taking on a new project that will cost $ It is estimated that the system will increase salesrevenues by $ annually for Years Operating expenses, other than depreciation, are expected to be equal to percent of sales in each year. The system will be depreciated on a MACRS basis over years depreciation rates are and to a zero book value, but the expected salvage at Year is $ The firm will also be required to invest $ in net working capital at Year but will recapture this amount at Year You may assume that the tax rate on ordinary income is percent record negative taxes as a positive cash flow As you can calculate, the IRR for this project is If we assume that the firm's cost of capital for this project is percent, then what is the NPV for this project?
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