We have been asked to advise a company about whether it should launch a new product. The company has previously spent 5 million researching and developing this product and anticipates that it will cost another 8 million to bring the product to market.  This product is expected to generate cash flow of 1.3 million per year for the next 20 years in a company will have to spend an additional 2 million at the end of the last year on environmental cleanup cost.  Their required rate of return is 10%.  What is the net present value of this project?

Answer rating: 100% (QA)

The formula for NPV is NPV Initial Investment Present Value of Cash Flows where I... View the full answer