Find the optimal time to abandon the investment

Reference no: EM1351546

An asset costs $100,000 and will generate cash benefits of $30,000 at the end of each year for 5 years for Hartford Corporation. Salvage value are $50,000, $40,000, and $0 at the end of year 3, year 4, and year 5 respectively. The required return is 10%. Assuming that this asset can be replicated, when is the optimal time to abandon the investment

Reference no: EM1351546

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