A clothing manufacturing firm is deciding whether to invest in a new technology that needs an initial investment of $45,000. This will increase cash flows in the first year by $25,000 and $30,000 in the second year. The firm's current fixed costs are $9,000 and marginal cost is $15. The firm currently charges $18 per unit. If the interest rate is 15% then What is the net present value of these cash flows ?

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Answer rating: 100% (QA)

To calculate the net present value NPV of the cash flows we need to discount the future cash flows t... View the full answer