Problem #5 Net Present Value, you the tables at the end of Chapter 16 - You...

 

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Problem #5 Net Present Value, you the tables at the end of Chapter 16 - You are thinking about buying a new machine which will cost you $75,000. It will last for seven years and save you $18,000 a year each year in operating costs. If your required rate of return is 12%, does the new machine pay for itself and should you buy it? Yes, because the net present value of the machine is $7,148 Yes because the net present value is $51,000 No, because the net present value is negative $57,000 There is not enough information to answer the question Problem #5 Net Present Value, you the tables at the end of Chapter 16 - You are thinking about buying a new machine which will cost you $75,000. It will last for seven years and save you $18,000 a year each year in operating costs. If your required rate of return is 12%, does the new machine pay for itself and should you buy it? Yes, because the net present value of the machine is $7,148 Yes because the net present value is $51,000 No, because the net present value is negative $57,000 There is not enough information to answer the question

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Answer Correct AnswerYes because the pre... View the full answer