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53. Sanders Company would like to purchase a specialized production machine for $1,000,000. The machine is expected to have a life of five years, and

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53. Sanders Company would like to purchase a specialized production machine for $1,000,000. The machine is expected to have a life of five years, and a salvage value of $300,000. Annual maintenance costs will total $50,000. Annual labor savings are predicted to be $280,000. The company's required rate of return is 15 percent. Ignoring the time value of money, what is the net cash inflow or (outflow) resulting from this investment opportunity? a. ($100,000) b. $950,000 c. $1,450,000 d. $450,000 e. None of the answer choices is correct. 54. The appropriate rate to be used for evaluating a long-term investment proposal can be referred to as all. of the following except: a the required rate of return. b. the discount rate. c. the cash flow rate. d. the hurdle rate. e. None of the answer choices is correct. I 55. If a project's net present value is positive, the internal rate of return is: a less than the discount rate. b. equal to the discount rate. c. greater than the discount rate. d. cannot be determined without more information e. None of the answer choices is correct 56. If a project's net present value is zero, the internal rate of return is: a. less than the discount rate. b. equal to the discount rate. c. greater than the discount rate. d. cannot be determined without more information. e None of the answer choices is correct. 8 57. If a project's net present value is negative, the internal rate of return is: a less than the discount rate. b. equal to the discount rate. c. greater than the discount rate. d cannot be determined without more information 58. If a project has an internal rate of return of 25% and a negative net present value, which of the following statements is true regarding the discount rate used for the net present value computation? a The required rate of return must have been 0% b. The required rate of return must have been equal to 25% c. The required rate of return must have been less than 25% d. The required rate of return must have been greater than 2596 c. None of the answer choices is correct

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