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M . T . Glass, Inc. is considering the acquisition of a new piece of heavy machinery to replace an old, outdated machine that is
MT Glass, Inc. is considering the acquisition of a new piece
of heavy machinery to replace an old, outdated machine that is
currently used in its business operations. The new machine will
cost $ and is expected to last years. The new machine
would require a repair of $ in year three and another
repair costing $ in year seven. The new machine has a
salvage value at the end of eight years of $ The old,
outdated machine costs $ per year to maintain and run.
The new machine is only expected to cost $ per year to
maintain and run. MT Glass has a cost of capital of and
an income tax rate of
Calculate the net present value NPV of the new machine. If
your answer is negative, place a minus sign in front of your
answer with no spaces in between eg
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