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What is the net present value of the project

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Reference no: EM133063919

Question - You are a consultant to a large manufacturing corporation considering a project with the following net after-tax cash flows (in millions of dollars):

Years from Now

After-Tax CF

0

-$33

1 to 10

$12

The project's beta is 1.4. Assuming rf = 4% and E(rM) = 14%.

Required -

a. What is the net present value of the project?

b. What is the highest possible beta estimate for the project before its NPV becomes negative?

Reference no: EM133063919

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