Reggie Redbird, the CEO of University Park Minivans, Inc believes that the firm could create additio

Reggie Redbird, the CEO of University Park Minivans, Inc believes that the firm could create additional value by adding golf carts to its product mix Machinery used in producing the golf carts would cost $4,100,000 

According to Redbird’s projections, the subsequent net cash flows the company would generate for the investors if it entered the golf cart business would be $990,000 per year for 12 years 

These are the only cash flows expected The firm’s annual weighted average cost of capital for a project of this type is 92% 

QUESTION: What is the NET PRESENT VALUE (NPV) of the golf cart project?

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