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Question 2 (10 points) Listen You want to buy a new equipment to replace an existing one. The new equipment will be depreciated down to

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Question 2 (10 points) Listen You want to buy a new equipment to replace an existing one. The new equipment will be depreciated down to zero using straight-line depreciation over its 10-year life. The project is a 10-year project. The market value of the new equipment at the end of year 10 is expected to be 0. The new equipment will replace an existing old equipment that has 10 years left of depreciation at a $5.000 a year. The estimated before tax proceeds from selling this existing equipment is $30,000 today. The market value in 10 years for this old equipment would be 0. The new equipment will generate annual cost savings of S11.000 before takes. The tax rate is 10% and the discounting rate is 11%. What is the maximum price you are willing to pay today for the new equipment? decimals (the nearest dollar). For your answer, do not enter the dollar sign ($), use commas to separate thousands, and you can round to zero

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