Considering a new project to retrofit a pump. The initial cost of the project is $100,000, and will save the company $25,000 per year in utility costs (income to the company). The salvage value of the pump after the 5 year life is $20,000. Use NPV at 8% interest rate to determine if this is a good investment. What is the payback?

Answer rating: 100% (QA)

To calculate the Net Present Value NPV of the project we can use the formula NPV CF0 CF11i1 CF21i2 C... View the full answer