What is unique about this project

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The L-S Mining Company is planning to open a new strip mine in western Pennsylvania. The net investment required to open the mind is $10 million. Net cash flows are expedited to be +$20 million at the end of year 1 and +$5 million at the end of year 2. At the end of year 3, L-S will have net cash outflow of $17 million to cover the cost of closing the mine and reclaiming the land.

A) Calculate the net present value of the strip mine if the cost of capital 5,10,15,30,71 and 80 percent.
B) What is unique about this project?
C) Should the project be accepted if L-S's cost of capital is 10 percent? 20 percent

 

Reference no: EM13304813

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