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Haulin'It Towing Company is considering adding more tow trucks to its fleet.

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Haulin'It Towing Company is considering adding more tow trucks to its fleet. The cost of the new trucks is $150,000. The project will utilize the risk adjusted discount, the firm has a beta of 1.3, the risk free rate is 7% and the return in the market is 15%. Should Haulin' It add the additional trucks if the expected increased revenues will be as follows?;Years Cash Flows;1 $80,000;2 $95,000;3 $110,000;a. No, the npv of the project is -$15,175.19;b. Yes, the npv of the project is $75,275.16;c. No, the npv of the project is -$9,765.12;d. Yes, the npv of the project is $55,050.92

 

Paper#22410 | Written in 18-Jul-2015

Price : $27
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