Create the cash flow table showing the costs

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Your company is preparing to launch a new product over the next 10 years. The equipment to make this new product will have an initial cost of $125000 to the company.

At the end of the project, you believe you can get $21000 for the equipment as salvage. Supplies will cost $1800 the first year and go up by $850 each year.

Maintenance costs start at $1250 the first year and will increase by 2.5% each year. The company expects to make $7500 the first year and this will increase by 1.2% each year.

Question 1: Create the cash flow table showing these costs and profits and the net cash flow.

Question 2: If the interest rate is 3.9%, what will be the NPV of the project?

Reference no: EM132557686

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