Question: So I have a question that asks: A project requires an initial investment of $700,000 depreciated straight-line to $0 in 10 years. The investment
So I have a question that asks: " A project requires an initial investment of $700,000 depreciated straight-line to $0 in 10 years. The investment is expected to generate annual sales of $400,000 with annual costs of $120,000 for 10 years. Assume a tax rate of 30% and a discount rate of 15%. What is the NPV of the project? "
I know how to do this problem, but on one of the past tests my professor gave a similar problem, but the straight-line depreciation was 10 years and the expected annual sales & costs were figured over 20 years. No clue how to solve this problem when those "year" values aren't the same. Any help would be much appreciated.
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