Gateway Communications $is$ considering a project with $an$ initial fixed assets cost $of$ $$1\mathrm{.}53$ million that will $be$ depreciated straight$-$line $to$ a zero book value over the $9-$year life $of$ the project. $At$ the end $of$ the project the equipment will $be$ sold for $an$ estimated $$242,000.$ The project will not change sales but will reduce operating costs $by$ $$403,000$ per year. The tax rate $is23$ percent and the required return $is11\mathrm{.}7$ percent. The project will require $$53,000in$ net working capital, which will $be$ recouped when the project ends. What $is$ the project's $NPV?$

$$422,006$

$$438,886$

$$371,690$

$$453,516$

$$388,585$

QUESTION $9$

Gateway Communications $is$ considering a project with $an$ initial fixed assets

$costof$ $$1\mathrm{.}53$ million that will $be$ depreciated straight$-$line $to$ a zero book value

over the $9-$year life $of$ the project. $At$ the end $of$ the project the equipment will

$be$ sold for $an$ estimated $$242,000.$ The project will not change sales but will

reduce operating costs $by$ $$403,000$ per year. The tax rate $is23$ percent and the

required return $is11\mathrm{.}7$ percent. The project will require $$53,000in$ net working

capital, which will $be$ recouped when the project ends. What $is$ the project's

$NPV?$

$$422,006$

$$438,886$

$$371,690$

$$453,516$

$$388,585$