CLEAN is considering investing in new manufacturing capabilities for one of its products and estimates...

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Finance

CLEAN is considering investing in new manufacturing capabilities for one of its products and estimates it will produce annual cash flows of $0.6 million in 2023, growing 35% in 2024, 45% in 2025, and 30% in 2026 and 5% in 2027. Assume the product becomes obsolete after 2027. The companys cost of capital is 16%.

The system will cost $2.0 million today.

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