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Please help Crane Manufacturers is considering investing in a new truck that will be used to deliver its custom made furniture. Paul Shop, Controller of
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Crane Manufacturers is considering investing in a new truck that will be used to deliver its custom made furniture. Paul Shop, Controller of Crane Manufacturers, is considering a truck which will cost $83200 and which has a useful life of 5 years. The new truck will save $9984 per year in operating costs which are realized at the end of each year, Paul believes if the new truck is purchased it could be sold for $67080 at the end of its useful life. Crane's required rate of return is 12% Periods Interest rate Factor 5 1296 0.5674 Type of cash flow PV of $1 FV of $1 PV ordinary annuity 5 1296 1.7623 5 12% 3.6048 FV ordinary annuity 5 12% 6.3528 5 12% 40374 PV annuity due What is the new truck's net present value? (round to the nearest dollar) $17995 $-9149 $ 8011 7078 E Step by Step Solution
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