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The following data pertain to an investment proposal (Ignore income taxes.): Cost of the investment $ 32,000 Annual cost savings $ 9,000 Estimated salvage value
The following data pertain to an investment proposal (Ignore income taxes.): | ||||||
Cost of the investment | $ 32,000 | |||||
Annual cost savings | $ 9,000 | |||||
Estimated salvage value | $ 3,000 | |||||
Life of the project | 5 yrs | |||||
Discount rate | 10% | |||||
Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided. | ||||||
The net present value of the proposed investment is closest to: (Round your intermediate calculations and final answer to the nearest whole dollar amount.) | ||||||
Multiple Choice | ||||||
$3,982 | ||||||
$2,119 | ||||||
$1,863 | ||||||
$20,000 |
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