Current location - Health Road Network - Medical equipment - A company plans to develop a new product line, the life of the product line is 4 years, the cost of developing a new product line and the projected revenue is: initial one-time investment

A company plans to develop a new product line, the life of the product line is 4 years, the cost of developing a new product line and the projected revenue is: initial one-time investment

(2) discount rate of 12%, the project's net present value can be calculated as follows:

NPV = -140 + 38 × 0.893 + 35 × O.797 + 32 × O.712 + 29 × O.636 + 66 × 0.567 = O.479 ($ million)

The project's net present value is greater than zero, from the financial feasibility.

(3) When the discount rate is taken as 13%, the net present value of the project is: (5 points)

NPV=-140+38×O.885+35×O.783+32×0.693+29×O.613+66×O.543=-3.174 From this, we can find the project's embedded rate of return: IRR=12%+(0-0.479)/(-3.174). 0.479)/(-3.174-0.479)*(13%-12%)

=12.13%

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