Question
Crafton Manufacturing is trying to decide between two different systems. System A costs $250,000, has a four-year life, and its expected cash flows are $95,000
Crafton Manufacturing is trying to decide between two different systems. System A costs $250,000, has a four-year life, and its expected cash flows are $95,000 per year. System B costs $450,000, has a four year life and its expected cash flow are $165,000 per year. If the discount rate is 10%, which system should the firm choose? why?
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Foundations of Finance The Logic and Practice of Financial Management
Authors: Arthur J. Keown, John D. Martin, J. William Petty
8th edition
132994879, 978-0132994873
