Hi, I have another problem that need help with.
Scott industries is considering launching a new product. The project is expected to cost $3 million in assets. A working capital investmetn of $800 000 will have to be made when the project is initiated. The product is expected to have a makret life of 3 years and will add 1.5 million in after tax profits to Scott industries. At close up the assets can be sold for 1 million (the asset pool will remanin open). Given that firm factes a tax rate of 35% and a discoiunt rate of 10%, should the project be initiated?
Scott industries is considering launching a new product. The project is expected to cost $3 million in assets. A working capital investmetn of $800 000 will have to be made when the project is initiated. The product is expected to have a makret life of 3 years and will add 1.5 million in after tax profits to Scott industries. At close up the assets can be sold for 1 million (the asset pool will remanin open). Given that firm factes a tax rate of 35% and a discoiunt rate of 10%, should the project be initiated?
Last edited: