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Diamond Company is considering investing in new equipment that will cost $1,400,000 with a 10-year useful life. The new equipment is expected to produce
Diamond Company is considering investing in new equipment that will cost $1,400,000 with a 10-year useful life. The new equipment is expected to produce annual inflows of 400,000 and annual outflows of 50,000. (ANSWER ALL PARTS OF THE QUESTION) Instructions 1. What is cash payback period? 2. If ther required rate of return is 12% what is the NPV? Excerpt of Factor Tables: PV of Annuity for (n)10 years at 12% : 5.65022 PV of Single Sum (n) 10 years at 12% : 24719 FV of Annuity for (n) 10 years at 12%: 17.54874 FV of Single Sum (n) 10 years at 12% : 4.045 - For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). BIUS Paragraph V Arial 10pt
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