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You are getting ready to start a new project that will incur some cleanup and shutdown costs when it is completed. The project costs
$5.38
million up front and is expected to generate
$1.19
million per year for
10
years and then have some shutdown costs at the end of year
11.
Use the MIRR approach to find the maximum shutdown costs you could incur and still meet your cost of capital of
14.9%
on this project.
Question content area bottom
Part 1
The maximum shutdown costs allowable to still have a positive NPV is
$enter your response here.
(Round to the nearest dollar.)
Answer & Explanation
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