Question: MagicCity is considering the purchase of new equipment that will cost $ 0 . 9 9 5 million if purchased today and will generate the
MagicCity is considering the purchase of new equipment that will cost $ million if purchased today and will generate the following cash inflows and outflows: see the table below:
The cost of capital is annually. Reinvestment rate is
Questions: Calculate NPV IRR, MIRR, BCR and Payback of the project. Should MagicCity pursue this investment? Why? Please provide a short written response addressing all indices and justifying your decision.
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