Question
Company income projection for five year: A=4 (PARAMETER) Yearly saving: $ (500 000+10 000 *A) Machinery's price tag: $ 2 000 000, Upfront payment :
Company income projection for five year:
A=4 (PARAMETER)
Yearly saving: $ (500 000+10 000 *A)
Machinery's price tag: $ 2 000 000,
Upfront payment : $ 400 000,
Sold after four years : $ (900 000+ 3 000 * A)
Insurance: $ 40 000 per year
Tax Rate : % 34
MARR: % 17
The principal of the loan will be paid back with equal installments in five years, at the end of the each year
Sale Tax: % 4
Loan Finance Rate: %15
For depreciation calculations, use Table 2.2 of the book.
The question is how to calculate NPV(Net Present Value) at the end of the five-year operation? Thank you very much!!!
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