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A company XYZ is considering manufacturing a product in space. The project lifetime is 10 years and has the following consecutive phases: Phase 1 (years 1 to 3): The engineering design and development requires 3 years. No production is done during this period Phase 2 (years 4 to 10): to launch the spacecraft into orbit, operate the equipment Phase 2 of the project has the following costs, all paid at the end of each year: Launch $7300000 Insurance $640000 Labor $1500000 Material $600000. The minimum attractive rate of return is i=25%If the annual net cash flow of phase 2 is $5300000 per year, what is the present value of the net cash flow when evaluated at the beginning of phase 2 (year 4)? Note that phase 2 is 7 years. Enter the answer in whole value

Financial Management, Finance

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