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4. If Dr. Smith buys a machine for $5,000 as is able to improve the earnings of her practice by $2,000 a year for five
4. If Dr. Smith buys a machine for $5,000 as is able to improve the earnings of her practice by $2,000 a year for five years, and then can sell the machine for $600 as scrap, what is the NPV at 15%? What is the IRR? Fill in the "Cumulative PV" Column in the table below (don't forget to identify the IRR) . NPV=2003; IRR=.3033 discount rate 0.15 0.15 Present value Cumulative year amount PV PV -5,000 -5,000 -5,000 1 2,000 1,739 2 2,000 1,512 3 2,000 1,315 2,000 1,144 2,600 1,293 2,003 IRR Focus
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