What is the npv

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Fireplaces etc. is about to launch a new range of wood stoves, priced at $110 per unit. The unit cost of wood stoves is 65$. The firm expects to sell the wood stoves over the next 5 years. The venture will require an initial investment of 25,000. Assume that investment will depreciate in a straight line. At the end of 5 years, the asset will have zero salvage value. Net working capital requirement is expected to be 20% of sales. Tax rate = 35%. Discount rate = 15%. What is the NPV? Should the company go ahead with the project? 

Year

Unit Sales

1

300

2

350

3

400

4

500

5

500

Reference no: EM133109520

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