A business is evaluating the purchase of a new machine to use in its manufacturing process. The
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A business is evaluating the purchase of a new machine to use in its manufacturing process. The new machine would cost $60,000 and have a useful life of 6 years. At the end of the machine's life, it would have a residual value of $5,000. Annual cost savings from the new machine would be $20,000 per year for each of the six years of its life. The business's minimum required rate of return is 16% on all new projects. How much is the net present value of the new machine?
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
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