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A hospital system has an opportunity to start a new ASC (Ambulatory Surgical Center) at an investment of $1,000,000. The planning horizon is 5 years.
- A hospital system has an opportunity to start a new ASC (Ambulatory Surgical Center) at an investment of $1,000,000. The planning horizon is 5 years.
Annual additional costs = $100,000
Annual revenues = $350,000.
At the end of the five years, there a salvage value of $50,000 that can be recovered from selling of the center equipment.
Compute
- NPV assume that the interest rate (IR) is 5%.
- IRR.
- If the management has decided at an MARR of 8%, find out if this project can be carried out.
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Quantitative Analysis For Management
Authors: Barry Render, Ralph M. Stair, Michael E. Hanna, Trevor S. Hale
14th Edition
