Your firm needs to buy a new $9500 copier. As part of a promotion, the manufacturer has offered to let you pay $10,000 in one year, rather than pay cash today. Suppose the risk-free interest rate is 7% per year. Is this offer a good deal? Show that its NPV represents cash in your pocket.

Answer rating: 100% (QA)

To determine if this offer is a good deal we need to calculate the net present value NPV of both opt... View the full answer