Calculation of NPV and IRR of project
The Fast Track Bikes, Inc., will take six years and the cost is $200,000 per year. Once produce the product is expect to make $300,000 per year for 10 years. The cost of capital is 10%
a. Calculate the NPV
b. Calculate IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged.