Question: Using NPV analysis, should Magic Timber and Steel (Magic) purchase the new Delta finishing machine? What other quantitative and/or qualitative factors need to be taken

  • Using NPV analysis, should Magic Timber and Steel (Magic) purchase the new Delta finishing machine?
  • What other quantitative and/or qualitative factors need to be taken in to consideration for the investment decision?
  • Sensitivity analysis (e.g. different discount rate, different selling price, change in maintenance cost)
  • What would be your recommendation(s)?
  • You may assume discount rate as 11%. And tax 30%

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