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A company would like to purchase a machine for $160,000 with a life of 8 years. They estimate the salvage value to be 3% of
A company would like to purchase a machine for $160,000 with a life of 8 years. They estimate the salvage value to be 3% of the initial machine cost. If other operating costs are estimated to be $15,000 per year. The interest rate the company uses to justify their investments is 9% per year compounded yearly. a. What is the capital recovery cost? b. What is the minimum amount of annual revenue ($? per year) that makes this investment an attractive option for the company
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