73 9.6 out of 16 poin Karabo Business Consultants is considering a new business opportunity. They will need to purchase a new machine f R1500000. Their old machine can be traded in for R250 000 and the new machine can be sold for R250 000 after 3 year Because of increased productivity the company expect to save on average R350000 per year. The company expect a minimu rate of return of 12% Determine the Net Present Value of this machine and also indicate if this will be a good or bad decision. Year 1 2 3 Cashflow R 350000 [350000] [600000] Discount Factor [0.893] 0.797 0.712 Present Value R [312550] [278950] [427200] Total cash inflows (1018700] Less Cash outflow [1250000] Net present value [-231300] Only state GOOD or BAD [BAD] Decision Specified Answer for: 0.893 0.893 SO IMA 9.6 out of 16 points sultants is considering a new business opportunity. They will need to purchase a new machine for machine can be traded in for R250 000 and the new machine can be sold for R250 000 after 3 years. productivity the company expect to save on average R350000 per year. The company expect a minimum sent Value of this machine and also indicate if this will be a good or bad decision. Cashflow Present Value R Discount Factor R 350000 [0.893] [312550) [350000] 0.797 [278950] [600000] 0.712 [427200] [1018700] [1250000] [-231300] [BAD] Decision 0.893