Compute Minimum Desired Rate of Return The Strubel Company has used the net present-value method in making
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Compute Minimum Desired Rate of Return The Strubel Company has used the net present-value method in making capital-investment decisions. The company rejected an offer of a machinery salesman who had convincing evidence that his $12,500 lifting equipment would save the company $3,000 in cash operating costs per year-for ten years. The disposal value of the machine was $2,000 at the end of ten years. In applying the net present-value method, the company computed a negative net present value of $457. What was the minimum desired rate of return? Show computations. L01
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