Posted by David Barnett on April 29, 2008 at 18:44:50:
In Reply to: Do I consider savings as positive cash flows? posted by Julia on April 29, 2008 at 11:52:28:
If you're trying to come up with an internal business case for a company buying a facility, then this savings is definitely important.
From academic experience, they usually wouldn't give you this information unless they wanted you to use it.
I haven't seen the question, but to me the trick would be whether to calculate this additional cash flow as a perpetuity or, if you know the remaining economic life of the factory, then you would have a value for N.Dave