Posted by
**LenniF** on
.

the equopiment to be used would be depreciated by the straight line method over its 3 yr life and would have a zero salvage value and no woking capital required . Revenues and othe operating cost are expected to be constant over the projects 3yr life However the products would reduce the re annual cash flow.what is the projects NPV. Constant (1-3yrs)WACC 10%,PRE-TAX cash low reduction for othepr oducts(cannibalization)-5000,Investment (depreciable basis) 80,000,straight line 33.333%,sales revenus 63,500,anual operating cost -25,000, tax rate 35.0%