Calculate the npv and irr without mitigation

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A mining company is considering a new project. Because the mine has received a permit, the project would be legal; but it would cause significant harm to a nearby river. The firm could spend an additional $9.33 million at Year 0 to mitigate the environmental problem, but it would not be required to do so. Developing the mine (without mitigation) would cost $54 million, and the expected net cash inflows would be $18 million per year for 5 years. If the firm does invest in mitigation, the annual inflows would be $19 million. The risk adjusted WACC is 14%.

Calculate the NPV and IRR without mitigation. Round your answers to two decimal places.

 

Reference no: EM13286180

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