Calculate the net present value of the equipment with a discount of 8% and PVA of 1.

Purchase cost when new $200,000

Salvage value now 0

Investment in major overhaul needed in next year 0

Salvage value in 8 years 8 years

Net Cash flow generated each year $43,900

**Note from member: I understand the formula all the way to (Why the PVA changes each year. What determines that? e.g., year one is 0.92593. Then from year 2 of generated cash, the percentage changes. Can you explain that, please?

a. $130,147

b. $147,320

c. $175.280

d. $29,290