Whats the potential problem here

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Reference no: EM133325642

Question: Readox is considering opening a plant producing ventilators in Guangzhou, China. The initial purchase of the land and equipment and the associated costs of operations will cost $100 million today. The plant is expected to generate $16 million worth of products per year for the next 12 years. At the end of the 12th year Readox will need to spend $20 million to restore the land to its original pristine nature appearance. Company managers want to use IRR rule to evaluate the project. What's the potential problem here?

Reference no: EM133325642

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