Epsilon Corp. is evaluating an expansion of its business. The cash-flow forecasts for the project are as follows: Years Cash Flow ($ millions) 0 −230 1-8 51 The firm's existing assets have a beta of 1.4. The risk-free interest rate is 5% and the expected return on the market portfolio is 10%. What is the project's NPV? (Enter your answer in millions. A negative answer should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.)
Epsilon Corp. is evaluating an expansion of its business. The cash-flow forecasts for the project are as follows: Years Cash Flow ($ millions) 0 −230 1-8 51 The firm's existing assets have a beta of 1.4. The risk-free interest rate is 5% and the expected return on the market portfolio is 10%. What is the project's NPV? (Enter your answer in millions. A negative answer should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Epsilon Corp. is evaluating an expansion of its business. The cash-flow
| Years | Cash Flow ($ millions) |
| 0 | −230 |
| 1-8 | 51 |
The firm's existing assets have a beta of 1.4. The risk-free interest rate is 5% and the expected return on the market portfolio is 10%. What is the project's
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