A new machine will cost $25,000 The machine is expected to last 4 years and has no salvage value If the interest rate is 12 , determine the return and the risk associated with the purchase 0 3 0 4 0 3 Annual savings $7000 58500 500...

PW 1 25000 7000PA 12 4 3739 PW 2 25000 8500PA 12 4 817 ...

A new machine will cost $25,000. The machine is expected to last 4 years and has no

Question:

A new machine will cost $25,000. The machine is expected to last 4 years and has no . If the interest rate is 12%, determine the return and the risk associated with the purchase.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...