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24) With a purchase of new equipment for $400,000, ABC Inc. can lower its annual operating...

24) With a purchase of new equipment for $400,000, ABC Inc. can lower its annual operating costs by $150,000. The equipment will be depreciated straight-line to a zero book value over the project’s life of 3years. At the end of the three years, the equipment will be sold for $30,000. The new equipment will require additional spare parts inventory of $15,000 over the 3year period. What is the NPV if the discount rate is 15 percent and the tax rate is 21 percent

Please show the calculations. Thank you in advance :)

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jeff jeffy answered 1 year ago
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