A company needs an increase in working capital of $19,000 in a project that will last...
A company needs an increase in working capital of $19,000 in a project that will last 4 years. The company's tax rate is 30% and its after-tax discount rate is 10%.
Click here to view Exhibit 13B-1 to determine the appropriate discount factor(s) using table.
The present value of the release of the working capital at the end of the project is closest to:
Homework Answers
The present value of the release of the working capital at the end of the project
= working capital × present value (10%,4)
= $19000 × 0.683
= $ 12977
Thus answer $ 12977
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