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PLEASE HELP WITH A THROUGH E NPV-Mutually exclusive projects Hook Industries is considering the replacement of one of its old metal stamping machines. Three alternative
PLEASE HELP WITH A THROUGH E
NPV-Mutually exclusive projects Hook Industries is considering the replacement of one of its old metal stamping machines. Three alternative replacement machines are under consideration. The relevant cash flows associated with each are shown in the following table: B. The firm's cost of capital is 11%. a. Calculate the net present value (NPV) of each press. b. Using NPV, evaluate the acceptability of each press. c. Rank the presses from best to worst using NPV. d. Calculate the profitability index (Pl) for each press e. Rank the presses from best to worst using PL U Machine A $85,200 Machine C $129,900 Initial investment (CF) Year (t) 1 2 3 4 5 6 7 8 ( ) $18,500 $18,500 $18,500 $18,500 $18,500 $18,500 $18,500 $18,500 Machine B $59,700 Cash inflows (CF) $12,000 $14,000 $16,400 $18,400 $19,700 $25,200 $49,900 $30,200 $19,500 $19,500 $19,700 $30,200 $40,200 $50,300Step by Step Solution
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