Fijisawa Inc. is considering a major expansion of its product line and has estimated the...
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Accounting
Fijisawa Inc. is considering a major expansion of its product line and has estimated the following cash flows associated with such an expansion. The initial outlay would be
$1,900,000, and the project would generate incremental free cash flows of $500,000 per year for 7 years. The appropriate required rate of return is 6 percent.
a. Calculate the NPV
b. Calculate the PI.
c. Calculate the IRR.
d. Should this project be accepted?
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