Consider the following two investment alternatives: End of Year Machine A -$1,000 900 800 700 0...

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Consider the following two investment alternatives: End of Year Machine A -$1,000 900 800 700 0 1 2 Net Cash Flow 3 Machine B -$2,000 2,500 800+200 Suppose that your firm needs either machine for only 2 years. The net proceeds from the sale of machine B are estimated to be $200. What should be the required net proceeds from the sale of machine A so that both machines could be considered economically indifferent at an interest rate of 10%? Consider the following two investment alternatives: End of Year Machine A -$1,000 900 800 700 0 1 2 Net Cash Flow 3 Machine B -$2,000 2,500 800+200 Suppose that your firm needs either machine for only 2 years. The net proceeds from the sale of machine B are estimated to be $200. What should be the required net proceeds from the sale of machine A so that both machines could be considered economically indifferent at an interest rate of 10%?

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Calculate Nov of Machine B using Interest rate of 10 for Machine find what cash flows in using IR 10 ... View the full answer