Question $26$

$10$ pts

Dramatic Corp. is considering a new project whose data are shown below. The equipment that would be used has a $3-$year tax life, would be depreciated by the straight$-$line method over its $3-$year life, and would have a zero salvage value. No change in net operating working capital would be required. Revenues and other operating costs are expected to be constant over the project's $3-$year life. What is the project's NPV$?$

$\backslash$table$[[$Risk$-$adjusted WACC,$12\mathrm{.}0\%],[$Net investment cost $($depreclable basis$),$$$65,000],[$Straight$-$line depreciation rate,$33\mathrm{.}3333\%],[$Sales revenues, each year,$$65,500],[$Annual operating costs $($excl depreciation$),$$$25,000],[$Tax rate,$35\mathrm{.}0\%]]$

MacBook Air

esc

#

$\%$

$8$

$

$$

En

$**$

$*$

$46$

A

S

D

G

H

ck