Great lakes clinic has been asked to provide exclusive


Great Lakes Clinic has been asked to provide exclusive healthcare services for next year's World Exposition. The clinic manager’s wanted to conduct a financial analysis of the project. An up-fron cost of $160,000 is needed to get the clinic in operation. Then a net cash flow of $1 million is expected from operations in each of the 2 years of the exposition. However, the clinic has to pay the organizers of the exposition a fee for the marketing value of the opportunity. This fee, which must be paid at the end of the 2nd year, is $ 2 million.

a. What are the net cash flows associated with the project?

b. What is the project's IRR?

c. Assuming a project cost of 10% capital, what is the project's NPV?

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Financial Management: Great lakes clinic has been asked to provide exclusive
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