Question
13. You were thinking of starting a company with investors. If your new company would borrow $15,000,000 in a loan to purchase a machine, the
13. You were thinking of starting a company with investors. If your new company would borrow $15,000,000 in a loan to purchase a machine, the interest rate was 3.5% annual (to be paid monthly) for 10 years? What would be the projected loan payments? (show table)
Same facts as above in Problem #13 - Now if the company was mandated by the government (or forced by a union) that they had to hire 4 more people at a salary and benefits of $62,800 per person per year or in other words, an extra $251,200 in payroll total per year in expenses or an extra $20,934 per month. Would you recommend going into business and purchasing the machine? Why or why not?
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