You have been offered a contract from Comp Co. You will receive $120,000 up front from Comp Co. In exchange, you will provide $50,000 in services each year for 3 years. Your cost of capital is 10%. Find the NPV and IRR of the deal. Should you accept the contract? Explain.
You have been offered a contract from Comp Co. You will receive $120,000 up front from Comp Co. In exchange, you will provide $50,000 in services each year for 3 years. Your cost of capital is 10%. Find the NPV and IRR of the deal. Should you accept the contract? Explain.
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 19P
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You have been offered a contract from Comp Co. You will receive $120,000 up front from Comp Co. In exchange, you will provide $50,000 in services each year for 3 years. Your cost of capital is 10%. Find the NPV and IRR of the deal. Should you accept the contract? Explain.
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