Beta Technologies is assessing a new project which requires an upfront investment of EUR 200,000....
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Accounting
Beta Technologies is assessing a new project which requires an upfront investment of EUR 200,000. The expected cash flows from the project are as follows:
Year | Cash Flows (Project Z) |
Initial Investment | (200,000) |
1 | 50,000 |
2 | 60,000 |
3 | 70,000 |
4 | 80,000 |
Requirements: a. Determine the payback period for Project Z. b. Calculate the NPV of the project if the discount rate is 7%. c. Should Beta Technologies proceed with the project based on the NPV rule? Explain your reasoning.
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