Houston Imaging Center is evaluating the purchase of a refurbished ultrasound machine. The machine requires an...

Transcribed Image Text:

Houston Imaging Center is evaluating the purchase of a refurbished ultrasound machine. The machine requires an initial investment of $21,000 and will generate after-tax cash inflows of $6,000 per year for 8 years. For each of the cost of capital listed below: (1) Cost of capital is 8% (2) Cost of capital is 9% (3) Cost of capital is 15% 1. Calculate the NPV 2. Indicate whether to accept or reject the machine. Explain your answer Houston Imaging Center is evaluating the purchase of a refurbished ultrasound machine. The machine requires an initial investment of $21,000 and will generate after-tax cash inflows of $6,000 per year for 8 years. For each of the cost of capital listed below: (1) Cost of capital is 8% (2) Cost of capital is 9% (3) Cost of capital is 15% 1. Calculate the NPV 2. Indicate whether to accept or reject the machine. Explain your answer

Answer rating: 100% (QA)

1 1 NP V at 8 21 000 6 000 1 08 1 6 000 1 08 2 6 000 1 08 8 19 8 18 59 2 NP V at 9 ... View the full answer