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Question 8 1 pts Given the following data, what is the proposal's NPV and should the machine be purchased for a tax-paying entity? Existing equipment
Question 8 1 pts Given the following data, what is the proposal's NPV and should the machine be purchased for a tax-paying entity? Existing equipment to be sold for AUD90,000, book value is AUD120,000 Initial investment AUD650,000 at Year O in machine with five-year life (no scrap value) and straight-line depreciation. Cash inflows from new machine are AUD200,000 per year over the life of the machine Required rate of return = 12%, (i.e. a 5 year annuity factor is 3.605). Tax rate = 30% O AUD94,295; Yes O (AUD82,300); No O AUD85,295; Yes O AUD 106,295; Yes O (AUD55,300); No Next
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