Top Posters
Since Sunday
G
4
K
3
o
3
3
m
2
c
2
r
2
p
2
s
2
s
2
b
2
c
2
Home Q & A Board Other Fields Homework Help Business Finance
New Topic  
nikki1992 nikki1992
wrote...
Go to Answer
Posts: 123
Rep: 0 0
4 months ago
Canadian Auto Shop Services has an opportunity to invest $550,000 in a new project that will generate additional operating profit of $200,000 per year. The asset has a six-year life, a CCA rate of 30%, and an expected salvage value of $60,000. The company's cost of capital is 12% and marginal tax rate is 35%. The risk premium for this type of project is 1.5%. Assume the asset class remains open after the asset is sold and the half-year rule applies in the first year. What is the project's NPV?

▸ $137,415

▸ $425,214

▸ $108,680

▸ $384,655
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
Author:
Read 27 times
1 Reply
Replies
Answer verified by a subject expert
madizmmadizm
wrote...
#1
Posts: 134
Rep: 0 0
4 months ago
Sign in or Sign up in seconds to unlock everything for free
More solutions for this book are available here
1

Related Topics

nikki1992 Author
wrote...

4 months ago
Brilliant ツ
annakc
wrote...

Yesterday
Thanks
Mkersey12
wrote...

2 hours ago
this is exactly what I needed
New Topic      
Quick Reply
Explore
Post your homework questions and get free online help from our incredible volunteers
  1063 People Browsing
Start New Topic Take the Tour CoursesNew Study Tools Topics Trending Browse by Textbook
Live Chat
Related Images
  
 176
  
 330
  
 312
Your Opinion
What's your favorite math subject?
Votes: 315
Previous poll results: Which country would you like to visit for its food?