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Hello, I need help with these two questions and how I would table/timeline format them. Thank you! Rambus Inc. would like to purchase a production
Hello, I need help with these two questions and how I would table/timeline format them. Thank you!
Rambus Inc. would like to purchase a production machine for $325,000. The machine is expected to have a life of three years, and a salvage value of $50,000. Annual maintenance costs will total $12,500. Annual savings are predicted to be $112,500. The company's required rate of return is 12%. Required: lgnoring the time value of money, calculate the net cash inflow or outflow resulting from this investment opportunity. Problem \#4: Capital Budgets Rambus Inc. would like to purchase a production machine for $325,000. The machine is expected to have a life of three years, and a salvage value of $50,000. Annual maintenance costs will total $12,500. Annual savings are predicted to be $112,500. The company's required rate of return is 12%. Required: (1) Using the Present Value Factors for \$1, calculate the net present value of this investment (ignoring taxes). (2) Based on your answer in requirement 1, should Rambus purchase the production machineStep by Step Solution
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