You are considering investing in a gas pipeline project. The initial cash outlay is ($8,000,000,) and the

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You are considering investing in a gas pipeline project. The initial cash outlay is \($8,000,000,\) and the pipeline is expected to generate free cash flows of \($1,500,000\) at the end of each year for 12 years. The required rate of return for this project is 12 percent.

a. What is the project’s payback period?

b. What is the project’s NPV?

c. What is the project’s PI?

d. What is the project’s IRR?

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Foundations Of Finance

ISBN: 9781292318738

10th Global Edition

Authors: Arthur Keown, John Martin, J. Petty

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