Problem
Investing in a bee keeping business is deemed to have the following cash flows over its useful life of 5 years. The abandonment value is also provided in a yearly basis
|
Year
|
Cash Flow
|
Abandonment Value
|
|
0
|
(520,000)
|
520,000
|
|
1
|
250,000
|
350,000
|
|
2
|
200,000
|
240,000
|
|
3
|
150,000
|
150,000
|
|
4
|
100,000
|
75,000
|
|
5
|
50,000
|
0
|
Required:
Determine when to abandon the project assuming a discount rate of 10%.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.