Answered step by step
Verified Expert Solution
Question
...
1 Approved Answer
help me solve for Net present value please OptiLux is considering investing in an automated manufacturing system. The system requires an initial investment of
help me solve for "
Net present value" please
OptiLux is considering investing in an automated manufacturing system. The system requires an initial investment of $5.0 million, has a 20-year life, and will have zero salvage value. If the system is implemented, the company will save $780,000 per year in direct labor costs. The company requires a 12% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1 ) (Use appropriate factor(s) from the tables provided.) o. Compute the proposed investment's net present value. b. Using the answer from part a, is the investment's internal rate of return higher or lower than 12% ? Hint: It is not necessary to compute IRR to answer this question. p=1/(1+i)n Table B.3+Present Value of an Annuity of 1 p=[11/(1+i)n]/i Table B. 4 Future Value of an Annuity of 1 f=[(1+i)n1]/i
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started