Question: Need help with the net present value and probability inference BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make
Need help with the net present value and probability inference
BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided belovw Machine A $75,500 8 years Machine B $180,000 8 years Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outfiows $20,000 $5,000 $40,000 $10,000 Click here to view PV table. Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. If the net present value is negative, use either a negative sign preceding the number eg 45 or parentheses eg 45 decimal places, e.g.125 and profitability index to 2 decimal places, e.g. 10.50. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Ro Machine A Machine B Net present value Profitability index
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