Assume that the required rate of return for investment projects at Rippenstock Corporation is 12 percent. One

Question:

Assume that the required rate of return for investment projects at Rippenstock is 12 percent. One department has proposed investment in new equipment with a 10-year life span and a present value of expected future annual cash flows of $120,000. The equipment’s initial outlay cost is $125,000 and it has a of $10,000. Will this investment project meet the required rate of return for the company?

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