FIN 571 Final Exam Guide Set 2 ( NEW )
What is the NPV of the project ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .)
NPV $
Should the company make the purchase ? No Yes
44 . Down Under Boomerang , Inc ., is considering a new three-year expansion project that requires an initial fixed asset investment of $ 2.64 million . The fixed asset will be depreciated straight-line to zero over its three-year tax life , after which it will be worthless . The project is estimated to generate $ 2,060,000 in annual sales , with costs of $ 755,000 . The tax rate is 35 percent and the required return is 13 percent .
What is the project ’ s NPV ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .)
NPV $
45 . What is the net present value of a project with an initial cost of $ 36,900 and cash inflows of $ 13,400 , $ 21,600 , and $ 10,000 for Years 1 to 3 , respectively ? The discount rate is 13 percent .
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FIN 571 Final Exam Guide Set 2 ( NEW )
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1 . Financial managers should primarily strive to : 2 . The process of planning and managing a firm ' s long-term assets is called :