What is the project npv for garden-grow products

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Problem 1: Garden-Grow Products is considering a new investment whose data are shown below. The equipment would be depreciated on a straight-line basis over the project's 3-year life, would have a zero salvage value, and would require some additional working capital that would be recovered at the end of the project's life. Revenues and other operating costs are expected to be constant over the project's life. What is the project's NPV?

Project cost of capital (r) 10.0%

Net investment in fixed assets (basis) $75,000

Required new working capital $15,000

Straight-line deprec. rate 33.333%

Sales revenues, each year $75,000

Operating costs (excl. deprec.), each year $25,000

Tax rate 35.0%

Reference no: EM132907482

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