Question: Consider a $40,000 machine that will reduce pretax operating costs by $12,000 per year over a 5-year period. Assume no changes in net working capital
Consider a $40,000 machine that will reduce pretax operating costs by $12,000 per year over a 5-year period. Assume no changes in net working capital and a zero-scrap value after five years. For simplicity, assume straight-line depreciation to zero, a marginal tax rate of 34 percent, and a required return of 10 percent. The net present value of acquiring this machine is: Group of answer choices $83. $167. $334. $1,064. Flag question: Question 35 Question 35 2 pts __________ is the situation that exists if a firm has positive NPV projects but cannot obtain the necessary financing. Group of answer choices Contingency Planning. Capital Rationing. Managerial Options. Strategic Options
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