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(Expansion Option)Now Suppose That Hit or Miss Sports from the Previous

Question 108

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(Expansion Option)Now suppose that Hit or Miss Sports from the previous problem can expand production if the project is successful.By paying its workers overtime,it can increase production by 25,000 units; the variable cost of each ball will be higher,however,equal to $35 per unit.By how much does this option to expand production increase the NPV of the project?

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The additional after-tax cash flow from ...

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