Question: You are evaluating purchasing the rights to a project that will generate after tax expected cash flows of $81k at the end of each of
You are evaluating purchasing the rights to a project that will generate after tax expected cash flows of $81k at the end of each of the next five years, plus an additional $1,000k at the end of the fifth year as the final cash flow. You can purchase this project for $612k. If your firm's cost of capital (aka required rate of return) is 14.2%, what is the NPV of this project? Provide your answer in units of $1000, thus, $15000 = 15k and thus you should enter 15 for your answer.
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