1) Kanas Veterans Clinic wants to buy a piece of equipment for $20,000 with projected cash

flows of $8,000 per year during the equipment's six-year useful life. What is the NPV of the

equipment at 5 percent? And what is the IRR?

2) Capital expenditure is essential for development of any business. However,

the US government

was enacting a number of laws that slowed down the growth of healthcare capital costs. Why is

the rationale reason for slowing down the capital costs of health institutions in the US?