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Discovey Ltd is considering to acquire a new business line to increase its market share....

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Finance

Discovey Ltd is considering to acquire a new business line to increase its market share. The acquisition cost of the new business is estimated to be $500,000 and the business is expected to generate the following cash flows:

Year 1 $100,000 inflow

Year 2 $150,000 inflow

Year 3 $200,000 inflow

Year 4 $200,000 inflow

If the firm requires a 10% return on the investment, what is the expected NPV of the project?

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