Finance Capital budgeting : Calculation of initial cash by ClassOf1

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									              Sub: Finance                                                               Topic: Capital Budgeting



              Question:
              Calculation of initial cash outflow
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              You will bid to supply 3 jets per year for each of the next three years to the Navy. To get set up,
              you will need $60 million in equipment, to be depreciated straight-line to zero over three years,
              with no salvage value. Total fixed costs per year are $10 million, and variable costs are $12
              million 
								
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