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1. Sell the copier or fix it up. Our cost of capital is 12% Option A We have estimated the following to Fix the

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1. Sell the copier or fix it up. Our cost of capital is 12% Option A We have estimated the following to Fix the photocopier Year Cash Flow 0 -10,200 1 -13,800 Rehab cost of fixing the machine Annual copying costs 2345 -13,800 -13,800 -13,800 -13,800 Find the NPV Option B Do we sell the photocopier and outsource the copying to a print shop? Year Cash Flow 9000 Received from the sale of the copier Outsourcing printing costs 0 1 -19,800 23 2 -19,800 3 -19,800 45 4 -19,800 5 -19,800 a. Find the NPV b. Which option do you chose?

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