Question (2): The IPS company has installed a system to help reduce the number of defective...
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Question (2): The IPS company has installed a system to help reduce the number of defective products. The capital investment in the system is $85,000, and the projected annual savings are tabled below. The system's market value at the EOY five is negligible, and the MARR is 15% per year. EOY 1 2 3 4 45 Savings 25,000 30,000 35,000 40,000 46,000 a. What is the FW of this investment? Based on economical decision rule, is this a good investment? 5 b. What is the IRR of the system? Based on economical decision rule, is this a good investment? c. What is the discounted payback period for this investment? Question (2): The IPS company has installed a system to help reduce the number of defective products. The capital investment in the system is $85,000, and the projected annual savings are tabled below. The system's market value at the EOY five is negligible, and the MARR is 15% per year. EOY 1 2 3 4 45 Savings 25,000 30,000 35,000 40,000 46,000 a. What is the FW of this investment? Based on economical decision rule, is this a good investment? 5 b. What is the IRR of the system? Based on economical decision rule, is this a good investment? c. What is the discounted payback period for this investment?
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Related Book For
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Posted Date:
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