Reading 25 terminal year after-tax non-operating CF first, net, represents, equation, invested

manasib

Hi there,
On page 29, equation 9, TNOCF’s calcuation has “NWCinv” added in, which represents the same amount of NWCinv invested in the first year of the project. i.e. TNOCF = Sal_T +NWCInv - T(Sal_T - B_T).
It’s probably a silly question, but can anyone please explain to me why this term exists. The textbook says it’s a ”return” of net working capital. I simply don’t get it.
Many thanks.

zbird2134

Got it. Thanks guys!