Unformatted text preview: CF = 22500, CF 1 = 6250, N j = 2, CF 3 = 17250, and I = 10 to solve for NPV 3 = $1,307.29 ≈ $1,307. Using a financial calculator, input the following: CF = 22500, CF 1 = 6250, N j = 3, CF 4 = 11250, and I = 10 to solve for NPV 4 = $726.73 ≈ $727. Using a financial calculator, input the following: CF = 22500, CF 1 = 6250, N j = 5, and I = 10 to solve for NPV 5 = $1,192.42 ≈ $1,192. The firm should operate the truck for 3 years, NPV 3 = $1,307. b. No. Salvage possibilities could only raise NPV and IRR. The value of the firm is maximized by terminating the project after Year 3....
View
Full Document
 Spring '08
 Staff
 Calculation, Following, Termination of employment, The Higher, CompactFlash

Click to edit the document details