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Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash
Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash flows from the contract would be $5.03 mition per year. Your upfrort solup cosis to be ready to produce the part would be $7.89 milion. Your discount rate for this cortract is 7.7%. a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in the value of your firm? a. What does the NPV rule say you shound do? The NPV of the projoct is 1 milion. (Round to two decimal places.)
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