Question
In: Finance
Market Top Investors, Inc., is considering the purchase of a $465,000 computer with an economic life...
|
Market Top Investors, Inc., is considering the purchase of a $465,000 computer with an economic life of six years. The computer will be fully depreciated over six years using the straight-line method, at which time it will be worth $126,000. The computer will replace two office employees whose combined annual salaries are $97,000. The machine will also immediately lower the firm’s required net working capital by $86,000. This amount of net working capital will need to be replaced once the machine is sold. The corporate tax rate is 21 percent. The appropriate discount rate is 11 percent. |
|
Calculate the NPV of this project. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
What is the NPV?
| Is it worthwhile to buy the computer? |
A. Yes
B. No
Solutions
jeff jeffy answered 1 year agoRelated Solutions
Market Top Investors, Inc., is considering the purchase of a $335,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$335,000 computer with an economic life of four years. The computer
will be fully depreciated over four years using the straight-line
method, at which time it will be worth $90,000. The computer will
replace two office employees whose combined annual salaries are
$91,000. The machine will also immediately lower the firm’s
required net working capital by $80,000. This amount of net working
capital will need to be replaced once the...
Market Top Investors, Inc., is considering the purchase of a $345,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$345,000 computer with an economic life of five years. The computer
will be fully depreciated over five years using the straight-line
method, at which time it will be worth $78,000. The computer will
replace two office employees whose combined annual salaries are
$89,000. The machine will also immediately lower the firm’s
required net working capital by $78,000. This amount of net working
capital will need to be replaced once the...
Market Top investors, Inc., is considering the purchase of a 345000 computer with an economic life...
Market Top investors, Inc., is considering the purchase of a 345000
computer with an economic life of four years. The computer will be
fully depreciated over four years using the straight line method,
at which time it will be worth 92,0000. The machine will also
immediately lower the firm’s required net working capital by 81000.
This amount of net working capital will need to be replaced once
the machine is sold. The corporate tax rate is 21 percent. The
appropriate...
Market Top Investors, Inc., is considering the purchase of a $385,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$385,000 computer with an economic life of five years. The computer
will be fully depreciated over five years using the straight-line
method, at which time it will be worth $30,000. The computer will
replace two office employees whose combined annual salaries are
$90,000. The machine also will immediately lower the firm’s
required net working capital by $70,000. This amount of net working
capital will need to be replaced once the...
Market Top Investors, Inc., is considering the purchase of a $365,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$365,000 computer with an economic life of four years. The computer
will be fully depreciated over four years using the straight-line
method, at which time it will be worth $114,000. The computer will
replace two office employees whose combined annual salaries are
$95,000. The machine will also immediately lower the firm’s
required net working capital by $84,000. This amount of net working
capital will need to be replaced once the...
Market Top Investors, Inc., is considering the purchase of a $340,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$340,000 computer with an economic life of five years. The computer
will be fully depreciated over five years using the straight-line
method, at which time it will be worth $54,000. The computer will
replace two office employees whose combined annual salaries are
$85,000. The machine will also immediately lower the firm’s
required net working capital by $74,000. This amount of net working
capital will need to be replaced once the...
Market Top Investors, Inc., is considering the purchase of a $340,000 computer with an economic life...
Market Top Investors,
Inc., is considering the purchase of a $340,000 computer with an
economic life of five years. The computer will be fully depreciated
over five years using the straight-line method, at which time it
will be worth $48,000. The computer will replace two office
employees whose combined annual salaries are $84,000. The machine
will also immediately lower the firm’s required net working capital
by $73,000. This amount of net working capital will need to be
replaced once the...
Market Top Investors, Inc., is considering the purchase of a $350,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$350,000 computer with an economic life of five years. The computer
will be fully depreciated over five years using the straight-line
method, at which time it will be worth $66,000. The computer will
replace two office employees whose combined annual salaries are
$87,000. The machine will also immediately lower the firm’s
required net working capital by $76,000. This amount of net working
capital will need to be replaced once the...
Market Top Investors, Inc., is considering the purchase of a $365,000 computer with an economic life...
Market Top Investors, Inc., is considering the purchase of a
$365,000 computer with an economic life of four years. The computer
will be fully depreciated over four years using the straight-line
method, at which time it will be worth $114,000. The computer will
replace two office employees whose combined annual salaries are
$95,000. The machine will also immediately lower the firm’s
required net working capital by $84,000. This amount of net working
capital will need to be replaced once the...
RightPrice Investors, Inc., is considering the purchase of a $362,000 computer with an economic life of...
RightPrice Investors, Inc., is considering the purchase of a
$362,000 computer with an economic life of four years. The computer
will be fully depreciated over four years using the straight-line
method. The market value of the computer will be $62,000 in four
years. The computer will replace 4 office employees whose combined
annual salaries are $107,000. The machine will also immediately
lower the firm’s required net working capital by $82,000. This
amount of net working capital will need to be...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- The legal landscape is perpetually changing. Psychologists must remain abreast of these changes to avoid potentially...
- We are evaluating a project that costs $1.68 million, has a six-year life, and has no...
- In C++ Having call-by-reference allows one to use storeback parameters, i.e., parameters whose values are transmitted...
- You must evaluate a proposal to buy a new milling machine. The base price is $175,000,...
- “Triangle Guessing” game in Python The program accepts the lengths of three (3) sides of a...
- THIS PROGRAM HAS TO BE WRITTEN IN C Single function to perform the parity computation on...
- Consider a buffer system consisting of Benzoic acid (pKa = 4.20) and sodium benzoate, a) Would...
ADVERTISEMENT