Question: Consider the following project with a 4 - year life. If terminated prior to 4 years, the equipment used will have a positive salvage value.
Consider the following project with a year life. If terminated prior to years, the equipment used will have a positive salvage value. Cash flows from the project and salvage values at various stages are shown in the table below. Choose the optimal operating life of the project. Assume aWACCofYearCash FlowSalvage ValueA yearsB yearsC yearD yearsE years
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