Printed Fashion (PF) is evaluating a potential 4 year project to produce t-shirts for the upcoming Olympic games. The upfront cost of this project is estimated to be $3.0 million. PF expects to be able to sell each t-shirt for a price of $19.95. PF expects to sell 100,000 t-shirts in year 1 and that sales volume will grow by 10% per year in years 2, 3 and 4. PF expects that the variable cost to produce each t-shirt will be $12.00. At the end of year 4, PF expects to be able to liquidate any remaining fixed assets for an after tax liquidation value of $2.0 million. The discount rate for the project is 8.0%. What is the project's expected NPV

Answer rating: 100% (QA)

To calculate the projects expected NPV we need to calculate the cash inflows and cash outflows for e... View the full answer