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LA Company is considering the purchase of an asset for $235,000. It is expected to produce the following net cash flows. The cash flows occur
LA Company is considering the purchase of an asset for $235,000. It is expected to produce the following net cash flows. The cash flows occur evenly within each year. Assume that Beyer requires a 12% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1). Year 1 Year 2 Year 3 Year 4 Year 5 Total Net cash flows $ 74,000 $ 52,000 $ 97,000 $ 143,000 $ 50,000 $ 416,000 a. Compute the net present value of this investment. b. Should Beyer accept the investment?
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