Illustrate what is the project npv

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Reference no: EM13103498

Q. (NPV and shareholder wealth) Stockholders are surprised to learn that the firm has invested $43 million in a project that has an expected payoff of $8 million per year for six years. The project’s cost of capital is 12%.

1. Illustrate what is the project’s NPV?

2. There are 3 million outstanding shares. Illustrate what should be the direct impact of this investment on the per-share value of the common stock?

Reference no: EM13103498

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