Dog Up! Franks is looking at a new sausage system with an installed cost of $296,400....

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Dog Up! Franks is looking at a new sausage system with aninstalled cost of $296,400. This cost will be depreciatedstraight-line to zero over the project's 4-year life, at the end ofwhich the sausage system can be scrapped for $45,600. The sausagesystem will save the firm $91,200 per year in pretax operatingcosts, and the system requires an initial investment in net workingcapital of $21,280.

If the tax rate is 25 percent and the discount rate is 12percent, what is the NPV of this project?

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Dog Up! Franks is looking at a new sausage system with aninstalled cost of $296,400. This cost will be depreciatedstraight-line to zero over the project's 4-year life, at the end ofwhich the sausage system can be scrapped for $45,600. The sausagesystem will save the firm $91,200 per year in pretax operatingcosts, and the system requires an initial investment in net workingcapital of $21,280. If the tax rate is 25 percent and the discount rate is 12percent, what is the NPV of this project?