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A week ago
General Motors has a weighted average cost of capital of 9%.  GM is considering investing in a new plant that will save the company $25 million over each of the first two years, and then $10 million each year thereafter.  If the investment is $100 million, what is the net present value (NPV) of the project?

▸ $37.5 million

▸ $36.5 million

▸ $39.7 million

$34.2 million
Textbook 
Fundamentals of Corporate Finance
Edition: 2nd
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$37.5 million
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