Raphael Restaurant is considering the purchase of a $9,800 soufflé maker. The soufflé maker has an...

Raphael Restaurant is considering the purchase of a $9,800 soufflé maker. The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method. The machine will produce 1,900 soufflés per year, with each costing $2.30 to make and priced at $5.30. Assume that the discount rate is 11 percent and the tax rate is 35 percent.

What is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

NPV

$

Should Raphael make the purchase?

Expert Solution

jeff jeffy answered 1 year ago

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