Generate net operating cash flows

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Blackmore Health System is considering a new orthopedic center. The building and equipment for the new center will cost $7,500,000. The new orthopedic center expects to generate net operating cash flows of $500,000, $1.5 million, $ 3 million, $4.5 million and $5.5 million over the next five years. The cost of capital is 7%. Use the NPV and IRR approaches to determine if this project should be undertaken. Show your work.

Reference no: EM132185325

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