Assume that THSI's cost of capital for this project is 15%. The net present value (NPV) of this temporary housing project is closest to ________
Temporary Housing Services Incorporated (THSI) is considering a project that involves setting up a temporary housing facility in an area recently damaged by a hurricane. THSI will lease space in this facility to various agencies and groups providing relief services to the area. THSI estimates that this project will initially cost $5 million to set up and will generate $21 million in revenues during its first and only year in operation (paid in one year). Operating expenses are expected to total $8 million during this year and depreciation expense will be another $2 million. THSI will require no working capital for this investment. THSI's marginal tax rate is 35%
A) $2,956,522
B) -$9.15
C) $5,913,044
D) -$2,956,522
Answer: A
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Why is bribery a major issue confronted by multinational companies operating in international markets?
a. The issue of bribery has the potential to benefit multinational companies as they will not be performing illegal acts in the U.S. b. Bribery is the only issue of international markets. c. The prevalence of bribery in foreign markets leaves industries at a competitive disadvantage. d. Bribery is the only issue international companies will be able to confront with success.
GoodFurn Furniture Company has recently moved to a new, larger location. At the new location, it has been unable to attract sufficient customers. Its owner did not have the cash to pay the current loan installment due for the building and inventory So, he decided to reduce all merchandise prices by at least 50 percent for a weekend sale to earn enough to make his loan payment. In this case, the owner's pricing objective can be classified as:
a. market share maximization. b. satisfactory profits. c. asset maximization. d. sales maximization.