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Homecare,a tax-payingorganisation that provides meals to the disadvantaged, estimates that it can save $16,000 a year in cash operating costs for the next 8 years
Homecare,a tax-payingorganisation that provides meals to the disadvantaged, estimates that it can save $16,000 a year in cash operating costs for the next 8 years if it buys a special-purpose oven at a cost of $96,000. No terminal disposal value is expected. The required rate of return is 4%. Assume all cash flows occur at year-end except for initial investment amounts.
Calculate and enter the net present value for the special-purpose oven considering income tax rate of 30% in the answer block below.
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