Question
For this question in the text, Fundamentals of Engineering Economics: (10.03-PR011)An investment of $600,000 is made in equipment that qualifies as 3-year equipment for MACRS-GDS
For this question in the text, "Fundamentals of Engineering Economics":
(10.03-PR011)An investment of $600,000 is made in equipment that qualifies as 3-year equipment for MACRS-GDS depreciation. The before-tax cash flows, measured in constant dollars, for the investment consist of a uniform annual series of $200,000 plus a $200,000 salvage value at the end of the 5-year planning horizon. A 25% tax rate and 3% inflation rate apply. The real ATMARR is 10%. a) Determine the after-tax cash flows, in constant dollars, for each year. b) Determine the present worth for the investment. c) Determine the real internal rate of return for the investment.
According to a couple of documents on course hero, the answer to this is:
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