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A new operating system for an existing Machine is expected to cost $710,000 and have a useful life of six years. The system -year-olds and
A new operating system for an existing Machine is expected to cost $710,000 and have a useful life of six years. The system -year-olds and in criminal after-tax income of $220,000 each year after deducting it straight line depreciation. The predicted salvage value of the system is $12,600. A machine cost $540,000, has a $22,100 salvage value, is expected to last eight years, and will generate an after-tax income of $84,000 per year after straight line depreciation. Assume the company requires a temper set rate of return on its investment. Compute the net present value of each potential investment.
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