Determine the NPV of the project

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Question - Troy Gold has an opportunity to invest in a gold mine. The initial investment is $250 million. Analysts estimate that the mine will produce 100,000 ounces of gold per year for the next 10 years. The extraction cost of gold is $150 per ounce and is expected to remain at the level. The current price of the gold is $600 per ounce and is expected to increase 4% per year for the next 10 years. Determine the NPV of the project at a discount rate of 10%.

Reference no: EM132813086

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