calculate net present value of the project?
cpmpany Xis considering launching an inoovative producti.e glass used in TV sets
company X has invested £500,000 to date in developing products
the market research report commissioned by the firm indicates the product will have a 4year life
the equipment required to manufacture the products costs £550,000
it is estimated that at the end of the new product life cycle the equipment will have a zero second hand value
annual sales volumes of 3000 units are forecast for the 4years of the life of the new product
the selling price of the product will be £120 per unit
variable cost £40 per unit
additional overheads of £40000 will be incurred
The cost of capital for the firm is 12% per annnum
assume all receipts and payments occur at year ends ignore inflation and taxation
calculate npv??