The SVP of Operations just phoned with good news

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You've been analyzing a $10 million capital investment with a 5-year useful life, but it has a negative NPV of $500,000. However, the SVP of Operations just phoned with good news: The initial investment in the capital asset will be $1 million less than originally thought. What is the revised NPV? The discount rate is 12%, the marginal tax rate is 35%, and the asset is a 3-year MACRS property.

Reference no: EM131329756

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