then the​ project's NPV is ​$nothing. ​(Round to the nearest​ dollar.)

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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​(Net present value​ calculation)  Carson Trucking is considering whether to expand its regional service center in​ Mohab, UT. The expansion requires the expenditure of
​$11,000,000
on new service equipment and would generate annual net cash inflows from reduced costs of operations equal to
​$2,000,000
per year for each of the next
7
years. In year
7
the firm will also get back a cash flow equal to the salvage value of the​ equipment, which is valued at
​$0.8
million. ​ Thus, in year
7
the investment cash inflow totals
​$2,800,000.
Calculate the​ project's NPV using a discount rate of
6
percent.
If the discount rate is
6
​percent, then the​ project's NPV is
​$nothing.
​(Round to the nearest​ dollar.)
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