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i need both a and b answered please! View Policies Show Attempt History Current Attempt in Progress Brooks Clinic is considering investing in new heart-monitoring
i need both a and b answered please!
View Policies Show Attempt History Current Attempt in Progress Brooks Clinic is considering investing in new heart-monitoring equipment. It has two options. Option A would have an ipitial lower cost but would require a significant expenditure for rebuilding after 4 years. Option B would require no rebuilding expenditure, but its maintenance costs would be higher. Since the Option B machine is of initial higher quality, it is expected to have a salvage value at the end of its useful life. The following estimates were made of, the cash flows. The company's cost of capital is 7%. Compute the (1) net present value, (2) profitability index, and (3) internal rate of return for each option. (Hint To solve fo: rate of return, experiment with alternative discount rates to arrive at a net present value of zero) (If the net present vofuel in nezative, use either a negative sign preceding the number eg 45 or parentheses eg (45). Round answers for present value and IRR decimal ploces, es. 125 and round profitabllity index to 2 decimal places, es. 12.50. For calculation purposes, use 5 decimal place disployed in the foctor table provided.) eTextbook and Media Attempts: 1 of 3 used (b) The parta of this quettion must be completes in erdif. Thispart will be avallable when you complete the part atiove Step by Step Solution
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