Blossom Co. purchased some equipment 3 years ago. The company's required rate of return is 12 %,
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Blossom Co. purchased some equipment 3 years ago. The company's required rate of return is 12%, and the net present value of the project was $(700). Annual cost savings were: $13000 for year 1; 11000 for year 2; and $9000 for year 3. The amount of the initial investment was
Present Value | PV of an Annuity | |
Year | of 1 at 12% | of 1 at 12% |
1 | 0.893 | 0.893 |
2 | 0.797 | 1.690 |
3 | 0.712 | 2.402 |
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