Question: show how answers are gotten! Caspian Sea Drinks is considering the purchase Of a plum juicer the PJX5. There is no planned increase in production.

Caspian Sea Drinks is considering the purchase Of a plum juicer the
show how answers are gotten!

Caspian Sea Drinks is considering the purchase Of a plum juicer the PJX5. There is no planned increase in production. The PJXS 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 NPV of the PJX5? a. The PJX5 Will cost $2.37 million fully installed and has a O year life. It Will be depreciated to a book vaue Of $243,072.00 and sold for that amount in year 10. b. The Engineering Department spent $14,672.00 researching the various juicers. c. Portions Of the plant floor have been redesigned to accommodate the juicer at a cost Of SI 7.69S.OO. d. The PJX5 Will reduce operating costs by $371 ,477.00 per year. e. CSD's marginal tax rate is 2200%. f. CSD 55.00% 'equity-financed. g. CSDb 13.00-year, semi-annual pay, 5.73% coupon bond sells for $965.00. h. GSD's stcwk currently has a market value of $20.12 and Mr. Bensen believes the market estirnates that dividends will grow at 2.52% forever. Next year's dividend is projected to be $1.50,

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