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Please help me with the question, thank you! Muse Corporation has gathered the following data on a proposed investment project: | Investment required in new
Please help me with the question, thank you!
Muse Corporation has gathered the following data on a proposed investment project: | Investment required in new equipment Annual cash inflows Salvage value of new equipment Life of the investment Annual depreciation $ 124,000 $ 35,300 $ 8,000 5 years $ 23,200 Using the factors below, the internal rate of return on Muse's investment is closest to: Periods | T 2 3 13% 0.885 1.668 2.361 2.974 .517 15% 0.870 1.626 2.283 2.855D 3.352 17% 19% 0.855 0.840 1.585 | 1.547 2.210 2.140 2.743 2.639 3.1993.058 T 5 3 Multiple Choice 15% 17% 19% 13% The management of Simple Corporation is investigating replacing an old machine with a new, more efficient machine. The current salvage value of the old machine is $24,000, the cost of the new machine is $160,000 and the expected life of the new machine is 4 years. The new machine is expected to save the company $67,450 per year in cash operating costs. Annual depreciation on the machine would be $40,000. The simple rate of return on the investment is closest to: Multiple Choice 27.2% 42.2% 20.2% 17.2%Step by Step Solution
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