Question
(Ignore income taxes in this problem) Your Company is considering buying a small aircraft for the use of its executives. The aircraft would have a
(Ignore income taxes in this problem) Your Company is considering buying a small aircraft for the use of its executives. The aircraft would have a useful life of 10 years. The company uses a discount rate of 7% in its capital budgeting. The net present value of the investment, excluding the value the annual increased productivity of the executives as they avoid commercial flights, is -$316,080. To the nearest whole dollar how large would the value of the annual increased productivity have to be to make the investment in the aircraft financially attractive?
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