Question
A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firms production process more efficient which in turn increases
A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firms production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $24,871.00 per year for 8 years and costs $99,086.00. The UGA-3000 produces incremental cash flows of $27,219.00 per year for 9 years and cost $124,618.00. The firms WACC is 9.77%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.
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Financial Accounting An Introduction
Authors: Mr Barry Elliott, Mr Augustine Benedict
2nd Edition
0273737651, 9780273737650
