Suppose a company is considering a new project that requires an initial investment of $200,000. The project is expected to generate annual cash flows of $70,000 for 5 years, with a required rate of return of 12%. The company has a tax rate of 20%.
(i) Calculate the base case NPV of the project. (6 Marks)
(ii) Suppose the projected cash flows and initial investment could be off by +/- 10%, what is the best and worst case scenario NPV for the project? (6 Marks)

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