Toyota is planning a new fuel cell powered car. It will cost $1.4 billion initially...

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Accounting

Toyota is planning a new fuel cell powered car. It will cost $1.4 billion initially and an additional $0.6 billion the year after to build the factory, which can then be linearly depreciated to zero over 20 years, and be sold for $900 million at the end of year 21.The company also has to put up $60 million to buy components just before operation starts at the beginning of year 2.For each of the 20 years of operation (years 2 to 21), Toyota expects to sell 1 million cars at a price of $40,000. Labor and components for each car add up to $38,500 per car. After completion at the end of year 1, it also costs $800 million each year to run the factory, independent of the level of production.Toyota's marginal tax rate is 34% and its cost of capital for this project is 12%.Part 6
Attempt 45 for 7 pts.
What is the present value of the cash flow from assets from year 2 to 20(ignoring the one for year 21 for now)(in $ million)?
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