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Victor’s company bought a building ten years ago to use as a warehouse for $1 million....

Victor’s company bought a building ten years ago to use as a warehouse for $1 million. Today, they are considering renovations costing $2 million to convert into a small factory for new products. The company thinks it would receive $1.5 million today (net of all taxes and costs) if they sold the building instead of converting it. Which of these cash flows should be included in the project’s cash flows and why? (1-3 sentences)

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