Bailey, Inc., is considering buying a new gang punch that would allow them to produce circuit...

Bailey, Inc., is considering buying a new gang punch that would allow them to produce circuit boards more efficiently. The punch has a first cost of $160,000 and a useful life of 15 years. At the end of its useful life, the punch has no salvage value. Labor costs would increase $5,500 per year using the gang punch, but raw material costs would decrease $16,500 per year. MARR is 5%/year.

What is the internal rate of return of this investment?

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Expert Solution

Rahul Sunny answered 1 year ago

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