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Business, 09.08.2021 23:30 tannercarr3441

Mini inc, Is contemplating a capital project costing $47,019. The project will provide annual cost savings of $18,000 for 3 years and have a salvage value of $3,000. The company's required rate of return is 10%. The company uses straightline depreciation. Year Present Value of 1 at 10% PV of an Annuity of 1 at 10%
1 0.909 0.909
2 0.826 1.736
3 0.751 2.487

This project is:

a. unacceptable because it has a negative NPV.
b. acceptable because it has a zero NPV.
c. unacceptable because it earns a rate less than 10%
d. acceptable because it has a positive NPV.

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Answers: 1

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Mini inc, Is contemplating a capital project costing $47,019. The project will provide annual cost s...

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