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A company is considering purchasing new equipment for $6,000, expected to save $1,200 annually for the next 6 years. The companys discount rate is 9%.
A company is considering purchasing new equipment for $6,000, expected to save $1,200 annually for the next 6 years. The company’s discount rate is 9%.
Requirements:
- Calculate the NPV.
- Determine the IRR.
- Compute the Payback Period and Discounted Payback Period.
- Discuss the sensitivity of the NPV to changes in the discount rate.
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Contemporary Engineering Economics
Authors: Chan S. Park
5th edition
136118488, 978-8120342095, 8120342097, 978-0136118480
