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: