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Hi! I know the answers to my question--however, I need to know how to get to those results. Specifically how to find PVIFA and if
Hi! I know the answers to my question--however, I need to know how to get to those results. Specifically how to find PVIFA and if you could give any hints as to how to do this on a financial calculator (I use BAII Plus Pro--But BAII Plus is fine--I think I can figure it out from there as long as you give step by step instructions--ie which buttons) that would be GREATLY appreciated.
The problem and answers are as follows:
Office Automation, Inc., must choose between two copiers, the XX40 or the RH45. The XX40 costs $2,800 and will last for 6 years. The copier will require a real aftertax cost of $310 per year after all relevant expenses. The RH45 costs $3,300 and will last 8 years. The real aftertax cost for the RH45 will be $285 per year. All cash flows occur at the end of the year. The inflation rate is expected to be 6 percent per year, and the nominal discount rate is 10 percent. Calculate the EAC for each copier. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) XX40 RH45 EAC $ $ -840.20 -770.57 Which copier should the company choose? RH45 O XX40Step by Step Solution
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