Question: Easter Tech is considering a new project that will require $ 1 2 9 , 0 0 0 of fixed assets and NWC of $

Easter Tech is considering a new project that will require $129,000 of fixed assets and NWC of $14000. The fixed assets will be depreciated on a straight-line basis to zero salvage value over 3 years. The project is expected to produce an operating cash flow of $54,000 in the first year with that amount decreasing by 5% annually for two years before the project is shut down. The fixed assets can then be sold for $35,000 at the end of the project, and all of the working capital will be recovered. The discount rate is 14.2% and the tax rate is 23%. Calculate NPV.

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