Aggie Grill is considering the purchase of an $8,000,000 flat-top grill. The grill has an economic life of 6 years and will be fully depreciated using the straight-line method. The grill is expected to produce 550,000 tacos per year for the next 6 years, with each costing $3.50 to make and priced at $8. Assume the discount rate is 10% and the tax rate is 21%. The restaurant expects the market value of the grill to be $0, 6 years from now. Calculate the initial cash outflow for the grill (e.g. the time 0 cash flow). (Enter a negative value and round to 2 decimals)

Answer rating: 100% (QA)

To calculate the initial cash outflow for the grill we need to consider the initial cost of t... View the full answer