MetalMouth received a $1.5 million government innovation grant. MetalMouth invested the grant money and developed a system to remove metal contaminants from storm water in shipyards. The firm estimates that each shipyard spends $400 000 a year on storm water clean-up efforts. If MetalMouth is able to sign up and retain four shipyards in the first year onwards, what is the present value (PV)of the project (net of investment)if the cost of capital for MetalMouth is 16% per year? Assume a cost of operations and other costs for SAP equal 60% of revenue.

Question

Quizplus · Accepted Answer

The Answer of MetalMouth received a $1.5 million government innovation grant. MetalMouth invested the grant money and developed a system to remove metal contaminants from storm water in shipyards. The firm estimates that each shipyard spends $400 000 a year on storm water clean-up efforts. If MetalMouth is able to sign up and retain four shipyards in the first year onwards, what is the present value (PV)of the project (net of investment)if the cost of capital for MetalMouth is 16% per year? Assume a cost of operations and other costs for SAP equal 60% of revenue.

MetalMouth Received a $1