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Question 14 25 pts A company is assessing an investment on a machine to make key holders. The project manager requires a minimum yearly
Question 14 25 pts A company is assessing an investment on a machine to make key holders. The project manager requires a minimum yearly rate on new projects of 10%. They estimate that 1.5 million units of key holders can be sold per year, for 6 years, costing $4.50 per unit, and selling at $7.50 per unit. The project includes the investment in a machine of $17 million, that depreciates totally during the project's length, with no salvage value, and an addition of $800,000 in net working capital to start the operations. Enter the value of the IRR in the box in the case you believe the manager should take this investment alternative, or enter O if you believe the manager should not make this investment.
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