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Orchids-R-Us is a high-end florist that ships fresh orchids worldwide. Orchids is considering the purchase of a new piece of equipment. The cost savings From
Orchids-R-Us is a high-end florist that ships fresh orchids worldwide. Orchids 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 $251,000. The equipment will have an initial cost of $1,301,500 and have an 8-year life. There is no salvage value for the equipment. If the hurdle rate is 10%, what is the internal rate of return? Ignore income taxes. (Future Value of $1, Present Value of $1, Future Value Annuity of $1. Present Value Annuity of $1.) (Use appropriate factor from the PV tables. Round your final answer to the nearest dollar amount.) Multiple Choice Between 6% and 8% 0 Between 8% and 10% 0 Greater than 10% 0 less than zero
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