q3

Al Jadeed Co. is considering purchasing a new copy machine for its main office. The new machine will require equipment for an initial investment of OMR 105,000 in year 0 and another investment of OMR 208,000 in year 1. The company expects to regain its initial investment in 3 years. The after-tax cash inflows are: OMR 40,000 (year 2), OMR 55,000 (year 3), OMR 63,000 (year 4), and OMR 60,000 (year 5 and each year up to year 10). Find: a. The Net Present Value (NPV) assuming the required rate of return is 14%. b. The Payback Period (PBP). C. Should the project be accepted according to the NPV? Why? d. Should the project be accepted according to the PBP? Why