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Newport Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in
Newport Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $207,000. The equipment will have an initial cost of $951,000 and have a 6-year life. There is no salvage value for the equipment. If the hurdle rate is 9%, what is the approximate net present value? Ignore income taxes.
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