Question: Q3) PC Ltd is considering a new investment whose data are shown below. The project will run for 3 years. The asset would be depreciated

Q3) PC Ltd is considering a new investment whose data are shown below. The project will run for 3 years. The asset would be depreciated on a straight-line basis over the project's 3-year life, would have a zero salvage book value and $2000 market value. The working capital need is $15000 for the entire project that will be invested at t=0 and would be recovered at the end of the project's life. Revenues and other operating costs are expected to be constant over the project's life. What is the project's NPV and IRR and PI? i) The terminal cash flow at the end of the project is (Show your detailed calculations) a) $56250 (approximately) b) $56900 (approximately) c) $41250 (approximately) d) $57550 (approximately) e) None of the above (Marks 4)
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