Question
CBA Elevator costs $50,000 with an expected life of 5 years. The elevator will be depreciated on a straight-line basis to an expected salvage value
CBA Elevator costs $50,000 with an expected life of 5 years. The elevator will be depreciated on a straight-line basis to an expected salvage value of zero.
The annual operating costs are $8,000. Applicable tax rate is 30% and required rate of return is 10.0%.
What is the net present value of the elevator?
| A. | $9,856 | |
| B. | -$9,856 | |
| C. | $109,856 | |
| D. | -$109,856 |
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Public Finance And Public Policy
Authors: Jonathan Gruber
2nd Edition
0716766310, 9780716766315
