Solution-Appraise the proposed project using the Net

Appraise the proposed project using the Net Present Value

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Reference no: EM133114060

Question - XYZ Ltd. is a building construction company, intending to undertake a new project, required $395.875 of initial investment. The cost of capital for this project is estimated at 8% per annum. A consultant of XYZ Ltd. has come up with the following cash flow projections:

Cash flows/Years	2021	2022	2023	2024	2025	2026
Cash inflows (£)	12,560	52,960	110,250	210,000	252,000	301,250
Cash outflows (£)	22,980	41,670	52,450	76,760	98,000	104,950

As the Finance Director of XYZ Ltd., you are required to:

a) Appraise the proposed project using the Net Present Value (NPV) technique.

b) Comment on the results.

Reference no: EM133114060

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Appraise the proposed project using the Net Present Value

Reference no: EM133114060

Reference no: EM133114060

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