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Please show all work ! thanks #1 Caspian Sea Drinks is considering the purchase of a plum juicer the PJX5. There is no planned increase
Please show all work ! thanks
#1 Caspian Sea Drinks is considering the purchase of a plum juicer the PJX5. There is no planned increase in production. The PJX5 will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the NPV of the PJX5? unanswered not_submitted a. The PJX5 will cost $1.58 million fully installed and has a 10 year life. It will be depreciated to a book value of $200,733.00 and sold for that amount in year 10. Attempts Remaining: Infinity b. The Engineering Department spent $22,762.00 researching the various juicers. c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $17,709.00. d. The PJX5 will reduce operating costs by $323,227.00 per year. e. CSD's marginal tax rate is 35.00%. f. CSD is 63.00% equity-financed. g. CSD's 11.00-year, semi-annual pay, 6.85% coupon bond sells for $1,020.00. h. CSD's stock currently has a market value of $21.07 and Mr. Bensen believes the market estimates that dividends will grow at 3.56% forever. Next year's dividend is projected to be $1.42. Submit Answer format: Currency: Round to: 2 decimal placesStep by Step Solution
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