Question: Please answer ASAP! You are operating an old machine that is expected to produce a cash inflow of $5,900 in each of the next 3

You are operating an old machine that is expected to produce a cash inflow of $5,900 in each of the next 3 years before it fails. You can replace it now with a new machine that costs $20,900 but is much more efficient and will provide a cash flow of $11,350 a year for 4 years. Calculate the equivalent annual cost of the new machine if the discount rate is 14%, Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Should you replace your equipment now? Yes No What is the profitability index of a project that costs $8,000 and provides cash flows of $2,500 in years 1 and 2 and $4,500 in years 3 and 4? The discount rate is 99 in. Note: Do not round intermediate calculations. Round your answer to 4 decimal places
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
