NPV Calculation for LEZ Enterprises

NPV Calculation for LEZ Enterprises

NPV Calculation for LEZ Enterprises for $5 Only (Instant Download)

LEZ Enterprises, Inc. has been considering the purchase of a new manufacturing facility for $700,000. The facility is to be depreciated on a straight line basis over 14 years. It is expected to have no value after those 14 years. Cash flow from depreciation are considered to be risk-free and so they should be discounted at the risk-free rate. Operating revenues from the facility are expected to be $160,000 during the first year. The revenues are expected to increase at the rate of 2.2% per year which is also expected to be the inflation rate. Production costs in the first year are $25,000 and they are expected to remain constant each year. The project ends after 14 years. LEZ’s cost of capital is 15%. Its corporate tax rate 21%. The risk-free rate 3%. What is the NPV of this project?

Price of Answer: Just US$3 only (Instant Download)

This answer is available in the Excel file.

Buy Now

Need Assistance…??  email us at [email protected].

If you need any type of help regarding Homework, Assignments, Projects, Case study, Essay writing or anything else then just email us at [email protected]solvemyquestion.com.  We will get back to you ASAP. Do not forget to maintain the time frame you need your work to be done.