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A. You were thinking of starting a company with investors. If your new company would borrow $15,000,000 in a loan to purchase a machine, the
A. You were thinking of starting a company with investors. If your new company would borrow $15,000,000 in a loan to purchase a machine, the interest rate was 3.5% annually (to be paid monthly) for 10 years. What would be the projected loan payments?
B. Now, if the company was told by the government that they had to hire 4 more employees with a salary $62,800 per year, or in other words, an extra $251,200 per year of expenses ($20,934 per month), would you recommend going into business and purchasing the machine? Why or why not?
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