Another question from the mock paper which i can’t seem to grasp. I re-watched the lecture videos and am more confused than ever with the following questions:
Able Ltd is considering a new project, details below:
Initial cost: $300,000 Expected life: 5 years Estimate scrap value: $20,000 Addition revenue from project: $120,000 per year Incremental costs from project: $30,000 per year Cost of Capital: 10%
a) calculate net present value of project Please sir can you explain step by step i just dont get it?