Calculating Project NPV Raphael Restaurant is considering the purchase of a $10,000 souffle maker. The souffle maker
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Calculating Project NPV Raphael Restaurant is considering the purchase of a $10,000 souffle maker. The souffle maker has an economic life of five years and will be fully depreciated by the straight-line method. The machine will produce 2,000 souffles per year, with each costing $2 to make and priced at $5. Assume that the discount rate is 17 percent and the tax rate is 34 percent. Should Raphael make the purchase? LO.1
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