Question: Project Evaluation - Dog Up! Franks is looking at a new sausuage system with an installed cost of $460 000. This cost will be depreciated

Project Evaluation - Dog Up! Franks is looking at a new sausuage

system with an installed cost of $460 000. This cost will be depreciated

straight-line to zero over the project's five-year life,at the end of which

the suasage system can be scrapped for $55000. The sausage system will

save the firm $155 000per year in pretax operating costs and the system

requires an initial investment in net working capital of $29 000.

If the tax rate is 21 percent and discount rate is 10 percent,what is the

NPV of this project?

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