Question: in order to launch a new model rocket project, space Y is planning to accumulate excess inventory upfront in the first year of the project,
In order to launch a new model rocket project, SpaceY is planning to accumulate excess inventory upfront in the first year of the project, leading to an increase in net working capital (NWC) of $20,000 in year 1. When the project is complete in year 5 , the inventory will decrease by the same $20,000. If the total impact of these changes in NWC in years 1 and 5 is to decrease the net present value (NPV) of the project by $4,521, what do you know about the required return ( r ) for the project? r>0% r=0% Not enough information to determine r
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
