Question: A firm forecasts its net working capital needs for a 5 - year project as follows: t = 0 : $ 3 2 5 ,
A firm forecasts its net working capital needs for a year project as follows:
t: $
t through t: NWC increases by $ per year
t: NWC goes to $
Assume the WACC for this project is per year. If the firm could cut its NWC needs in half ie the initial NWC would be cut in half, and the annual increases would be half as much by using lean operation techniques, by how much would the NPV of the project be improved?
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
