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Author Question: Ford Motors expects a new hybrid-engine project to produce incremental cash flows of $100 million ... (Read 83 times)

Redwolflake15

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Ford Motors expects a new hybrid-engine project to produce incremental cash flows of $100 million each year and expects these to grow at 4% each year.  The upfront project costs are $900 million and Ford's weighted average cost of capital is 9%.  If the issuance costs for external finances are $10 million, what is the net present value (NPV) of the project?
◦ $1290 million
◦ $1090 million
◦ $1100 million
◦ $1800 million


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Marked as best answer by Redwolflake15 on Jul 9, 2019

Mochi

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