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Concose Park Department is considering a new capital investment. The following information is available on the investment. The cost of the machine will be $330,000
Concose Park Department is considering a new capital investment. The following information is available on the investment. The cost of the machine will be $330,000. The annual cost savings if the new machine is acquired will be $85,000. The machine will have a 5-year life, at which time the terminal disposal value is expected to be $32,000. Concose Park Department is assuming no tax consequences. If Concose Park Department has a required rate of return of 10%, what is the NPV of the project?
a. $12,086.80
b. $342,086.80
c. -$7,782
d. $330,000
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