A new electronic process monitor costs $870,000. This cost could be depreciated at 31% per year (Class 10). The monitor would actually be worthless in five years. The new monitor would save $470,000 per year before taxes and operating costs. If we require a 16% return, what is the NPV of the purchase? Assume a tax rate of 46%. 

NPV $

Answer rating: 100% (QA)

To calculate the Net Present Value NPV of the purchase we need to consider the cash flows associated ... View the full answer