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Marigold, Inc. is considering purchasing equipment costing $42000 with a 6-year useful life. The equipment will provide annual cost savings of $10600 and will be

Marigold, Inc. is considering purchasing equipment costing $42000 with a 6-year useful life. The equipment will provide annual cost savings of $10600 and will be depreciated straight-line over its useful life with no salvage value. Marigold requires a 10% rate of return.

Present Value of an Annuity of 1

Period 8% 9% 10% 11% 2% 15%

6 4.623 4.486 4.355 4.231 4.111 3.784

What is the approximate net present value of this investment?

$2848

$5552

$4163

$21600

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