A company is considering a 4-year project that would require a $220,000 up-front investment in net working capital. The project is expected to generate annual before-tax cost savings of $750,000. Assume the company requires a return of 12% and has a tax rate of 20%. If you were computing the NPV for this project, what amount would you use for the present value of net working capital in your NPV analysis?

Answer rating: 100% (QA)

To find the present value of net working capital in the NPV analysis we need to consider the nature ... View the full answer