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Coach Inc. would like to purchase equipment to expand its business. The company is given the following payment options: Option Pay $440,000 at the end
Coach Inc. would like to purchase equipment to expand its business. The company is given the following payment options: Option Pay $440,000 at the end of 3 years Option Pay $142,000 at the end of every year for 3 years Option Pay $393,000 now Present value table factors: N=3, 1=4% Single Sum = 0.88900 N=3, I=4% Annuity = 2.77509 Which is the cheapest option for the company (assume equal risk and an annual interest rate of 4%)?
Coach Inc. would like to purchase equipment to expand its business. The company is given the following payment options: Present value table factors: N=3,I=4%SingleSum=0.88900N=3,I=4%Anmuity=2.77509 Which is the cheapest option for the company (assume equal risk and an annual interest rate of 4% )Step by Step Solution
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