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Hi, please help with this. Thanks Unequal lives lANPV approachEvans Industries wishes to select the best of three possible machines, each of which is expected
Hi, please help with this. Thanks
Unequal lives lANPV approachEvans Industries wishes to select the best of three possible machines, each of which is expected to satisfy the firm's ongoing need for additional aluminum-extrusion capacity. The three machines A, B, and C are equally risky. The firm plans to use a cost of capital of 12.5 to evaluate each of them. The initial investment and annual cash inflows over the life of each machine are shown in the following table.)
Machine A Machine B Machine C initial investment (CFD) $91,000 $64,700 S100,100 Yea (t) Cash inflows (CF $11,200 S9600 $29,300 11,200 29,300 20,200 29,300 30.800 11,200 39.300 29,300 29,300 11,200 Calculate the NPV for each rrachine over its e. Rank the machines in descending order on the b asis of NPV. b. se the annualized nef present value (ANPV) approach to evaluate and rank the machnes in descending onder on the basis of ANPV c. Compare and contrast your findings in parts (a) and (b. Which mach would wou recommend that the firm acquire? a. The net present value for machine A is $D (Round to the nearest cent) a' Vi I. (II) More Enter your answer in the answer box and then click Check Answer parts Cloa remainingStep by Step Solution
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