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Assume a firm is planning to buy some new equipment. Use the following information to figure out the net present discounted value of each investment
- Assume a firm is planning to buy some new equipment. Use the following information to figure out the net present discounted value of each investment expenditure (each machine bought) and, therefore, how many units of capital (machines) the firm should buy. Assume each machine has a life span of three years.Make sure to figure out the present discounted value of each machine boughtand to show your work
Pk= $15,500
r =10%
MRP (Marginal Revenue Product) of first machine bought= $9,500
MRP of second machine bought= $8,000
MRP of third machine bought= $6500
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The Worldly Philosophers The Lives, Times And Ideas Of The Great Economic Thinkers
Authors: Robert L Heilbroner
7th Edition
068486214X, 9780684862149
