Question: please follow rounding instructions. will upvote if answer is correct. thank you for your time! Caspian Sea Drinks is considering the purchase of a plum
Caspian Sea Drinks is considering the purchase of a plum juicer - the PJXs. There is no planned increase in production, The PJX5 will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the IRR of the PJX5? a. The PJX5 will cost $2.28 million fully installed and has a 10 year life. It will be depreciated to a book value of $207,181.00 and sold for that amount in year 10. b. The Engineering Department spent $48,823.00 researching the various juicers. c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $18,108.00 d. The PJX5 will reduce operating costs by $458,457.00 per year. e. CSD's marginal tax rate is 24.00% f. CSD is 58.00% equity-financed. g. CSD's 16.00-year, semi-annual pay, 6.60% coupon bond sells for $1,009.00 h. CSD's stock currently has a market value of $21.06 and Mr. Bensen believes the market estimates that dividends will grow at 2.70% forever. Next year's dividend is projected to be $1.68. Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924))
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