Question: Cooper Construction is considering purchasing a new, technologically advanced equipment. The equipment will cost $640,000. The equipment is expected to generate additional annual cash inflows with the following probabilities for the next ten years. Its WACC is 10%. What is its expected "Cash Flow and Net Present Value?"
|
Cash Flow
|
Probability
|
|
$60,000
|
.10
|
|
$85,000
|
.20
|
|
$110,000
|
.45
|
|
$130,000
|
.25
|