What will be the change in the value of the company

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Problem 1: An auto-parts company is deciding whether to sponsor a racing team for a cost of $2,112,150. The sponsorship would last for 10 years and is expected to have cash flows by $638,645 per year. If the discount rate is 9.46%, what will be the change in the value of the company if it chooses to go ahead with the sponsorship?

Reference no: EM132823992

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