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fOR THE npv CALCULATION, -1,5000,000 + 565,000/(1.06)+ 565,000/(1.06)^2 + (1.06)^3 tHEY ARE SUPPOSED TO BE EXPONENTS. aLSO KEEP IN MIND THAT THE SET OF 3 NUMBERS YOU SEE IN PART a UNDER CASH FLOWS, REPRESENT THE AMOUNT IN YEAR 1, YEAR 2, AND YEAR 3, WHERE
SORRY I MISCALCULATED SOMETHING!!! HERE IS THE CORRECT SOLUTION! a. Cash flows (Millions of Dollars) Year 0 Year 1 Year 2 Year 3 Initial Investment –1.5 Sales 1.2 1.2 1.2 Costs 0.6 0.6 0.6 –Depreciation 0.5 0.5 0.5 EBT 0.1 0.1 0.1 Taxes 0.035 0.035

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