Question
Scenario 2 Equipment does not always last as long as planned. Calculate the following assuming that the equipment lasts only nine (9) years instead of
Scenario 2 Equipment does not always last as long as planned. Calculate the following assuming that the equipment lasts only nine (9) years instead of ten (10). 5. What is the payback period for the equipment acquisition? 6. What is the simple rate of return for the equipment acquisition? 7. Use both the PV discount factor chart provided within the spreadsheet and Excel formulas to calculate net present value of the proposed equipment acquisition. 8. Use both the PV discount factor chart provided within the spreadsheet and Excel formulas to calculate the internal rate of return of the proposed equipment acquisition. 9. What will be your advice regarding purchasing the equipment given these assumptions? Should Muesli AG buy the equipment or not? Explain.
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