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Dowling Sportwear is considering building a new factory to produce baseball bats. The project will require an initial outlay of $ 8,000,000 and will generate annual net cash inflows of $ 2,000,000 per year for 6 years. Calculate the project's Net Present Value (NPV) assuming a 9% discount rate:                   a. $871,837 b. $971,837 c. $6,000,000 d. $4,000,000

Dowling Sportwear is considering building a new factory to produce baseball bats. The project will require an initial outlay of $ 8,000,000 and will generate annual net cash inflows of $ 2,000,000 per year for 6 years. Calculate the project's Net Present Value (NPV) assuming a 9% discount rate:                   a. $871,837 b. $971,837 c. $6,000,000 d. $4,000,000

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 3EA: If a copy center is considering the purchase of a new copy machine with an initial investment cost...
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Dowling Sportwear is considering building a new factory to produce baseball bats. The project will require an initial outlay of $ 8,000,000 and will generate annual net cash inflows of $ 2,000,000 per year for 6 years. Calculate the project's Net Present Value (NPV) assuming a 9% discount rate:
 
 
 
 
 
 
 
 

 

a. $871,837

b. $971,837

c. $6,000,000

d. $4,000,000

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