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A company is considering purchasing a backhoe that will cost $110,000. It will last 6 years with a salvage value of $20,000 and will reduce
A company is considering purchasing a backhoe that will cost $110,000. It will last 6 years with a salvage value of $20,000 and will reduce maintenance and operating costs by $30,000 per year. The after-tax MARR of the company is 9% and the tax rate is 55%.
a) What is the exact after-tax IRR (%) for this investment?!
b) What is the approximate after-tax IRR (%)?1
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