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The president of Arthur's Inc. has asked you to evaluate the proposed acquisition of a new computer. The computer's price is $40,000 and it will
The president of Arthur's Inc. has asked you to evaluate the proposed acquisition of a new computer. The computer's price is $40,000 and it will be fully depreciated by the beginning of the project. Purchase of the computer would require an increase in accounts payable of $2,000. The computer would have an EBT & Depreciation of $15,000. The computer is expected to have a salvage value of $25,000. The firm's marginal tax rate is 20 percent, and the project's cost of capital is 14 percent. What is the project's NPV? O $8,047.52 O $10,009.07 $20,411.49 $82,009.07 $92,411.49
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