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Grove Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in

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Grove Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income of $200,100. The equipment will have an initial cost of $1,200,100 and have an 8-year life. The salvage value of the equipment is estimated to be $200,100. The hurdle rate is 11%. Ignore income taxes (Future Value of $1. Present Value of $1. Future Value Annuity of $1. Present Value Annuity of $1.) (Use appropriate factor from the PV tables.) a. What is the accounting rate of return? (Round your answer to 2 decimal places.) Rate of Return b. What is the payback period? (Round your answer to one decimal place.) Payback Period Years c. What is the net present value? (Do not round intermediate calculations and round your final answer to the nearest dollar amount.) Net Present Value d. What would the net present value be with a 14% hurdle rate? (Do not round intermediate calculations and round your final answer to the nearest dollar amount.) Net Present Value am 30 Help Save & Exit Subm d. What would the net present value be with a 14% hurdle rate? (Do not round Intermediate calculations and round your final answer to the nearest dollar amount.) Net Present Value e. Based on the NPV calculations, what would be the equipment's internal rate of return? (Round your answer to 2 decimal places.) Internal Rate of Return Grove Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income of $200,100. The equipment will have an initial cost of $1,200,100 and have an 8-year life. The salvage value of the equipment is estimated to be $200,100. The hurdle rate is 11%. Ignore income taxes (Future Value of $1. Present Value of $1. Future Value Annuity of $1. Present Value Annuity of $1.) (Use appropriate factor from the PV tables.) a. What is the accounting rate of return? (Round your answer to 2 decimal places.) Rate of Return b. What is the payback period? (Round your answer to one decimal place.) Payback Period Years c. What is the net present value? (Do not round intermediate calculations and round your final answer to the nearest dollar amount.) Net Present Value d. What would the net present value be with a 14% hurdle rate? (Do not round intermediate calculations and round your final answer to the nearest dollar amount.) Net Present Value am 30 Help Save & Exit Subm d. What would the net present value be with a 14% hurdle rate? (Do not round Intermediate calculations and round your final answer to the nearest dollar amount.) Net Present Value e. Based on the NPV calculations, what would be the equipment's internal rate of return? (Round your answer to 2 decimal places.) Internal Rate of Return

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