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    aftertax cash flows

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    Cost of capital is 12%. Its expects aftertax cash flows (including the tax shield from depreciation) for the next 5 years are:
    Year 1 $ 10,000
    Year 2 20,000
    Year 3 30,000
    Year 4 20,000
    Year 5 5,000

    a) Calculated the NPV.
    b) calculate the IRR
    c) Would you accept the project?

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    https://brainmass.com/economics/output-and-costs/aftertax-cash-flows-185400

    Solution Preview

    Your firm has an opportunity to make an investment of $50,000
    Cost of capital is 12%. Its expects aftertax cash flows (including the tax shield from depreciation) for the next 5 years are:
    Year 1 $ 10,000
    Year 2 20,000
    Year 3 30,000
    Year 4 20,000
    Year 5 5,000

    a) Calculated the NPV.

    NPV is calculated by finding the present value of each cash flow, including both cash inflows and outflows, discounted at ...

    Solution Summary

    This solution is comprised of a detailed explanation to calculate the NPV, IRR, and answer whether to accept the project or not.

    $2.19

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