Question: Moondata Company is considering purchasing a new machine for AED 80,000. The new facility will generate annual net cash inflows of AED 20,000 for six

 Moondata Company is considering purchasing a new machine for AED 80,000.

Moondata Company is considering purchasing a new machine for AED 80,000. The new facility will generate annual net cash inflows of AED 20,000 for six years. At the end of the six years the machine will have no residual value. The company uses straight line depreciation, and its stockholders demand an annual return of 12% on investments of this nature. Compute: The Payback Period. Years (2 Pts.) b. The ARR % (2 Pts.) C. The NPV, AED (4 Pts.) d. The Profitability Index of this investment. (2 Pts.)

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