Question

Management of TSC, Inc. is evaluating a new $90,000 investment with the following estimated cash flows:
Year Cash Flow
1......... $10,000
2......... 25,000
3......... 40,000
4......... 50,000
If the firm’s cost of capital is 10 percent and the project will require that the firm spend $15,000 to terminate the project, should the firm make the investment?


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  • CreatedMarch 19, 2015
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