Project will need an initial investment

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Reference no: EM13763206

New Co is considering investing in a new hotel project. The project will need an initial investment of 1,000,000 in year zero and will generate 500,000 (after tax) cash flows for the four subsequent years. In the fourth year the project will need an additional investment of 250,000. The cost of capital will be 10% in the first year and 6% in the second, third and fourth year. What is the NPV of the project?

Reference no: EM13763206

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