The construction of a new coal mine will cost Yamada Co. Ltd. $430,000, with the expenditure occurring the next year. The investment will bring about cash flows of $200,000 annually over the following seven years. It will then cost $170,000 to close down the facility over the following year. The assumption follows that cash flows occur at the end of the year. On the other hand, the company can opt to sell the site today. Construct the timeline. What minimum price should Yamada Co. Ltd. set on this facility given a 16 percent required rate of return?

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