The company is exploring the purchase of a new piece of equipment that will cost $1,500,000, at
Fantastic news! We've Found the answer you've been seeking!
Question:
The company is exploring the purchase of a new piece of equipment that will cost $1,500,000, at an expected discount rate of 8%. The equipment is expected to return net cash inflows of $250,000 over the next 10 years.
Based on the above information calculate the following items for this proposed equipment purchase:
- Net Present Value
- Internal Rate of Return
- Payback Period
Would you recommend the company invest in this equipment? Why or why not?
Please explain the NPV, IRR, and payback calculations. Also, please explain how would I use an Excel sheet to calculate NPV, IRR, and Payback period.
Related Book For
Posted Date: