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A company in the manufacturing industry is evaluating the possibility of installing a new lathe in its plant. For this project, he analyzes three alternatives

A company in the manufacturing industry is evaluating the possibility of installing a new lathe in its plant. For this project, he analyzes three alternatives for said machinery that have a different useful life. The project will be financed as follows:

The 33% of the total financing will be obtained with a bank loan, which has a cost of 12% per year after tax. The rest of the resources will be obtained from shareholders' funds, who face a risk rate of 4.1%, a profile risk of 1.40 and a risk premium of 5. 8% A) Calculate the weighted average cost of capital for the project; b) The equivalent net present value of each of the alternatives: and c) Conclude which is the best alternative, based on the equivalent net present value criterion.

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Cuadro 1: Proyectos con Vidas Desiguales Alternativa A Alternativa B Alter cial -$13,000.00 -$20,000.00 -$25 eracin anual -$4,000 -$2,500 -$1 cate $3,000 $1,000 e til 2 4 Cuadro 1: Proyectos con Vidas Desiguales Alternativa A Alternativa B Alter cial -$13,000.00 -$20,000.00 -$25 eracin anual -$4,000 -$2,500 -$1 cate $3,000 $1,000 e til 2 4

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