You have been hired to evaluate a capital investment proposal for a local oil company.

Chapter Question
Topic: You have been hired to evaluate a capital investment proposal for a local oil company. Please calculate the NPV for the following project proposal:
$400,000 initial cost for equipment
$25,000 per year additional incremental annual cash revenues for 3 years
$5,000 per year additional incremental annual cash expenses for first 2 years
Project ends at the end of year 3
Minimum required return of 12%
Assume taxes are irrelevant
The project managers have already spent $50,000 on preliminary design and architectural expenses.
Should the project be accepted or rejected?
To earn the most points, show your calculations for computing the NPV.
Directions: Upload your response.
Warning: DO NOT PLAGIARIZE. In your responses, you must always use your own words. Do not simply copy/paste your answers directly or indirectly from Google search results. That is considered plagiarism. Plagiarism may result in a 0 on the assignment, and further disciplinary action being taken by the Office of Academic Affairs. Your responses will be evaluated using the anti-plagiarism software from Vericite.
NOTE: I recommend writing your response in a Word document first, and then uploading your response into Canvas when completed. This will allow you to save your work in Word in case your computer crashes, and also Word allows you to check for spelling and grammar mistakes.
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