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An asset in the five-year MACRS property class costs $150, 000 and has a zero estimated salvage value after six years of use. The asset

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An asset in the five-year MACRS property class costs $150, 000 and has a zero estimated salvage value after six years of use. The asset will generate annual revenues of $320, 000 and will require $80, 000 in annual labor and $50, 000 in annual material expenses. There are no other revenues and expenses. Assume a tax rate of 40%. (a) Compute the after-tax cash flows over the project life. (b) Compute the NPW at MARR = 12%. Is the investment acceptable

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