The Bruin's Den Outdoor Gear is considering a new 6-year project to produce a new...
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The Bruin's Den Outdoor Gear is considering a new year project to produce a new tent line. The equipment necessary would cost $ million and be depreciated using straightline depreciation to a book value of zero. At the end of the project, the equipment can be sold for percent of its initial cost. The company believes that it can sell tents per year at a price of $ and variable costs of $ per tent. The fixed costs will be $ per year. The project will require an initial investment in net working capital of $ that will be recovered at the end of the project. The required rate of return is percent and the tax rate is percent. What is the NPV
The Bruin's Den Outdoor Gear is considering a new year project to produce a new tent line. The equipment necessary would cost $ million and be depreciated using straightline depreciation to a book value of zero. At the end of the project, the equipment can be sold for percent of its initial cost. The company believes that it can sell tents per year at a price of $ and variable costs of $ per tent. The fixed costs will be $ per year. The project will require an initial investment in net working capital of $ that will be recovered at the end of the project. The required rate of return is percent and the tax rate is percent. What is the NPV
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