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Determine the net present value of the investment proposal

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Reference no: EM132082212

Question - Salt River Company is evaluating a capital expenditure proposal that has the following predicted cash flows:

Initial investment

$ (42,070)

Operation

Year 1

20,000

Year 2

30,000

Year 3

10,000

Salvage

0

(a) Using a discount rate of 14 percent, determine the net present value of the investment proposal.

(b) Determine the proposal's internal rate of return.

Reference no: EM132082212

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