Question
Eastworld Manufacturing spends $28,000 to update the lighting in its factory to more energy-efficient LED fixtures. This will save the company $5,000 per year in
Eastworld Manufacturing spends $28,000 to update the lighting in its factory to more energy-efficient LED fixtures. This will save the company $5,000 per year in electricity costs. The company estimates that these fixtures will last for 10 years. The companys cost of capital is 8%.
- What is the NPV of this project?
- What is the IRR of this project?
- What is the Payback period?
- What is the Profitability index?
- Should you accept or reject the project? Why?
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Modern Equity Investing Strategies
Authors: Anatoly B Schmidt
1st Edition
9811239495, 978-9811239496
