A shoe manufacturer is evaluating new equipment that would custom fit athletic shoes. The new equipment costs
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A shoe manufacturer is evaluating new equipment that would custom fit athletic shoes. The new equipment costs $90,000 and will generate $35,000 in net cash flows for five years. Determine the break-even time for this equipment.
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Net Cash Present Value Present Value of Net Cumulative Present Value Year Flows of 1 at 10% Cash Flows of Net Cash Flows Initial investment $(90,000) 1.0000 1 35,000 0.9091 35,000 0.8264 35,000 0.7513 4 35,000 0.6830 5 35,000 0.6209 3.
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