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Rosalinda Corporation is currently using antiquated computer terminal purchase 7 yers ago. The company is analyzing a proposal to purchase a new computer display at
Rosalinda Corporation is currently using antiquated computer terminal purchase 7 yers ago. The company is analyzing a proposal to purchase a new computer display at the price of RM350,000 and will have a five year expected useful life. The company requires a minimum rate of return of 12 percent. The maximum payback period is 3 years. The company has derived the following cash flow of new computer display. Based on the information, you are required to determine: i) Is worth for the company to purchase new computer display using net present value (NPV)? ii) Based on the profitability index, should Rosalinda corporation buy the new computer display? Justify your
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