Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Galvanized Products is considering the purchase of a new computer system for their enterprise data management system. The vendor has quoted a purchase price of

image text in transcribed

Galvanized Products is considering the purchase of a new computer system for their enterprise data management system. The vendor has quoted a purchase price of $100,000. Galvanized Products is planning to borrow 1/4th of the purchase price from a bank at 15% compounded annually. The loan is to be repaid using equal annual payments over a 3-year period. The computer system is expected to last 5 years and has a salvage value of $5,000 at that time. Over the 5-year period, Galvanized Products expects to pay a technician $25.000 per year to maintain the system but will save $55,000 per year through increased efficiencies, Galvanized Products uses a MARR of 18%/year to evaluate investments. Click here to access the TVM Factor Table Calculator Parta What is the annual worth of this investment?$ Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is 5 Galvanized Products is considering the purchase of a new computer system for their enterprise data management system. The vendor has quoted a purchase price of $100,000. Galvanized Products is planning to borrow 1/4th of the purchase price from a bank at 15% compounded annually. The loan is to be repaid using equal annual payments over a 3-year period. The computer system is expected to last 5 years and has a salvage value of $5,000 at that time. Over the 5-year period, Galvanized Products expects to pay a technician $25.000 per year to maintain the system but will save $55,000 per year through increased efficiencies, Galvanized Products uses a MARR of 18%/year to evaluate investments. Click here to access the TVM Factor Table Calculator Parta What is the annual worth of this investment?$ Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is 5

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Mathematical Finance Core Theory Problems And Statistical Algorithms

Authors: Nikolai Dokuchaev

1st Edition

0415414482, 978-0415414487

Students also viewed these Finance questions