Question
A new computer system will require an initial outlay of $19,250, but it increase the firm's cash flows by $4,100 a year for the next
A new computer system will require an initial outlay of $19,250, but it increase the firm's cash flows by $4,100 a year for the next 7 years. A. Calculate the NPV and decide if the system is worth installing if the required rate of return is 10%. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.) b. Calculate the NPV and decide if the system is worth installing if the required rate of return is 15%. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.)
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