Question 41

A Young entrepreneur is considering buying or leasing a Xerox machine for a photocopying business office. The cost of the Xerox machine is $15,000. The annual maintenance cost is $750. The expected annual revenue from photocopying is $5500. If he decides to lease the machine the annual cost is $4000 including maintenance. The Xerox machine becomes obsolete after five years if he buys. Assume that funds have to be borrowed at an interest rate of 15%.Calculate the Net Present value (NPV) if he buys the Xerox machine.( Enter your answer without the dollar sign)

Relevant Formula (A/F, i%, n)= i/(1+i)ⁿ 1 (P/A, i%,n) = (1+i)ⁿ 1/ i(1+i)ⁿ (F/P, i%. n) = (1 + i)ⁿ

Question 42

A Young entrepreneur is considering buying or leasing a Xerox machine for a photocopying business office. The cost of the Xerox machine is $15,000. The annual maintenance cost is $750. The expected annual revenue from photocopying is $5500. If he decides to lease the machine the annual cost is $4000 including maintenance. The Xerox machine becomes obsolete after five years if he buys. Assume that funds have to be borrowed at an interest rate of 15%.Calculate the Net Present value (NPV) if he leases the Xerox machine. (Enter your answer without the dollar sign) Relevant Formula (A/F, i%, n)= i/(1+i)n 1 (P/A, i%,n) = (1+i)n 1/ i(1+i)n (F/P, i%. n) = (1 + i)n