Initial investment outlay of $20 million for equipment only
Project and equipment life: 5 years
Sales projected to be $12 million per for 5 years
Assume gross margin of 50% (exclusive of depreciation)
Depreciation: straight-line for tax purposes
Selling, general and administrative expenses: 10% of sales
Tax rate: 35%
Solve for NPV and IRR.
Solve for NPV and IRR.
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