Asset class is large and continues after project terminates

Assignment Help Financial Management

Reference no: EM131899807

Tamarisk Company's tax rate is 40 percent and the appropriate discount rate is 11 percent. It is considering a project. Each asset class is large and continues after the project terminates. Tamarisk is not capital constrained. There is no change in net working capital at the beginning or at the termination of the project. The initial investment is $4,080; annual pre-tax operating cash flow is $2,190; salvage value is 0; the CCA rate is 30 percent; and the length of the project is three years. Calculate the NPV. (Round present value factor calculations to 6 decimal places, e.g. 1.251247 and the final answer to 2 decimal places, e.g. 15.75. Enter negative amounts using either a negative sign preceding the number e.g. -45.25 or parentheses e.g. (45.25).) Should Tamarisk take this project?

Reference no: EM131899807

Questions Cloud

Simple regulatory system to supervise banks : As an international financial centre in Asia, Hong Kong has a sound but not simple regulatory system to supervise banks.

Discuss about the nature of international production : The volume of world trade rebounded sharply in 2010 on the back of a fairly modest growth rate in the world economy. What does this tell you about the nature.

Compromising on the financial stability of the country : Appraise what the regulator can do to allow it flourish without compromising on the financial stability of the country

Calculate the NPV and IRR of the project : Calculate the NPV and IRR of the following project and check whether they produce the same decision.

Asset class is large and continues after project terminates : Each asset class is large and continues after the project terminates.

Create a negative reaction on the part of the receiver : The "voice" of our written word is as important as the message itself. It's equivalent to our "tone of voice" when we are communicating verbally.

What the target population should be composed of : What the target population should be composed of, and about what information should be provided to support the purpose of the survey.

Required rate of return of stock FM by the CAPM model : What is the required rate of return of stock FM by the CAPM model?

Corresponding interest rate and regression method : Using the following data on the price of a bond and the corresponding interest rate (assuming a flat term structure) and regression method,

User Account

All Pages