Question: Please help me with this question please, Kind regards. SeaCruises plc is evaluating the purchase of a new ship. The ship would cost 30 million

Please help me with this question please, Kind regards.

Please help me with this question please, Kind regards. SeaCruises plc is

SeaCruises plc is evaluating the purchase of a new ship. The ship would cost 30 million upfront to purchase, and it would operate for 10 years. The net cash flows from operating the ship ar expected to be 5 million at the end of the first year, and to grow at 2% per year. At the end of 10 years, the ship will be sold for an expected value of 50 million. The company's cost of capital is 5% per year. What is the Net Present Value of this investment, in million? O A. 42.64 million O B. 41.94 million O C. 73.33 million O D. 72.64 million

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!