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Question 3 (2.5 points) Tombstone Industries is considering a new product expansion. The project will require the firm to use an old piece of equipment
Question 3 (2.5 points) Tombstone Industries is considering a new product expansion. The project will require the firm to use an old piece of equipment that could otherwise be sold today. Currently, the old piece of equipment has a market value of $200,000, and has a book value of $80,000. The tax rate facing the firm is 30%, and the cost of capital is 18%. What is the opportunity cost today for accepting this project? $176,000 $164,000 $172,800 $116,000 $159,200
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