Q1) Blue Snow has come up with new composite snowboard. Development will take Blue Snow 4 years and cost $250,000 per year, with first of four equal investments payable today upon acceptance of project. Once in production snowboard is expected to make annual cash flows of $200,000 each year for 10 years. Blue Snow's discount rate is 10%. Illustrate calculations.
a) Find out IRR for Blue Snow's snowboard project?
b) Compute NPV for Blue Snow's snowboard project?