Larson Manufacturing is considering purchasing a new injection-molding machine for $360,000 to expand its production capacity....

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Larson Manufacturing is considering purchasing a new injection-molding machine for $360,000 to expand its production capacity. It will cost an additional $25,000 to do the site preparation. With the new injection-molding machine installed, Larson Manufacturing expects to increase its revenue by $97,000 per year. The machine will be used for four years, with an expected salvage value of $67,000. At an interest rate of 8%, would the purchase of the injection-molding machine be justified? Click the icon to view the interest factors for discrete compounding when i = 8% per year. The present worth of the project is (Round to the nearest dollar.) Larson Manufacturing is considering purchasing a new injection-molding machine for $360,000 to expand its production capacity. It will cost an additional $25,000 to do the site preparation. With the new injection-molding machine installed, Larson Manufacturing expects to increase its revenue by $97,000 per year. The machine will be used for four years, with an expected salvage value of $67,000. At an interest rate of 8%, would the purchase of the injection-molding machine be justified? Click the icon to view the interest factors for discrete compounding when i = 8% per year. The present worth of the project is (Round to the nearest dollar.)

Answer rating: 100% (QA)

To determine whether the purchase of the injectionmolding machine is justified well calculate the pr... View the full answer