Calculate the npv of the project

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Question - Lily, a sole trader, is considering a project A which requires an initial investment of $860. The project is expected to generate permanent sales of $1,100 per year. Costs are $600 for the first year and will increase by 20% per year. (Assume all sales and costs occur at year-end, i.e., costs are $600 at t = 1.) Ignore taxes and calculate the NPV of the project at a 12% cost of capital.

Reference no: EM133070601

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