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Business, 24.07.2020 19:01 alyssabond8325

Suppose Fuzzy Button Clothing Company is evaluating a proposed capital budgeting project (project Alpha) that will require an initial investment of $550,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $375,000
Year 2 $475,000
Year 3 $425,000
Year 4 $500,000

Required:
Fuzzy Button Clothing Company's weighted average cost of capital is 7%, and project Alpha has the same risk as the firm's average project. Based on the cash flows, what is project Alpha's net present value (NPV)?

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