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11. In order to avoid hiring an outside firm to perform your firm's special cargo delivery needs, you consider buying a new truck for $40,000.
11. In order to avoid hiring an outside firm to perform your firm's special cargo delivery needs, you consider buying a new truck for $40,000. You have been using a trucking service one day every other week for S200/day, plus $1 per mile. And you always give the driver a $40 tip. Most trips are 80-100 miles You estimate that your expense of the new truck will be $0.45/mile plus insurance of $1200/year. You would not hire any additional employees; you would just reallocate their time. after 8 years, you figure the truck will be worth $15,000 at which point you'd sel it ify our cost o capita s 9% is this a positive P r e Hint: lay out the savings from NOT using the service as a positive cash flow. Then, as negative cashflows, layout the cost of buying the truck and doing this yourself. Fill these cells with yellow paint: Cashflow zero -1 pt, Cashflow 1-1 point, Cashflow 8-1 point, Correct NPV calculation and the inclusion of the word "yes" or "no"- 2 points For a total of 5 points 0 1 2 34 6 7 Initial Investment Savings from NOT using service: New truck expenses: Ne sh NPV at 9%
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