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General
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Your firm is contemplating the purchase of a new $535,000 computer-based order entry system. The system will be
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depreciated straight-line to zero over its five-year life. It will be worth $30,000 at the end of that time. You will save $165,000 before taxes per year in order processing costs, and you will be able to reduce working capital by $60,000(this is a one-time reduction). If the tax rate is 24 percent, what is the IRR for this project?
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