I don't know what to do with this. Archer Daniels Midland Company is considering buying a new farm that it plans to operate for 10 years. The farm will require an initial investment of $12.10 million. This investment will consist of $2.20 million for land and $9.90 million for trucks and other equipment. The land, all trucks, and all other equipment is expected to be sold at the end of 10 years at a price of $5.19 million, $2.39 million above book value. The farm is expected to produce revenue of $2.02 million each year, and annual cash flow from operations equals $1.85 million. The marginal tax rate is 35 percent, and the appropriate discount rate is 9 percent. Calculate the NPV of this investment.
Paper#5572 | Written in 18-Jul-2015Price : $25