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7,Outdoor Sports is considering adding a putt putt golf courseto its facility. The course would cost $171,000, would bedepreciated on a straight-line basis over its 4-year life, andwould have a zero salvage value. The sales would be $93,500 a year,with variable costs of $28,050 and fixed costs of $12,650. Inaddition, the firm anticipates an additional $20,500 in revenuefrom its existing facilities if the putt putt course is added. Theproject will require $3,250 of net working capital, which isrecoverable at the end of the project. What is the net presentvalue of this project at a discount rate of 13 percent and a taxrate of 34 percent?
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