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2. You need to purchase a machine. It costs $75,000 and will expand cash flow by $10,000/year in year 1, growing by 2.3% per year

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2. You need to purchase a machine. It costs $75,000 and will expand cash flow by $10,000/year in year 1, growing by 2.3% per year after that. The system will work for 10 years before you have to replace it. What are the NPV (at a 4.2% discount rate) and IRR? The vendor offers you another machine costing $120,000 and lasting 15 years, with the same starting cash flow and a 2.5% growth rate. What are the NPV and the IRR for it? Which machine should you purchase

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