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. . . Thomas Cruise has invested a new motorboat at $10,000 that a life of 10 years and no salvage. On the basis of
. . . Thomas Cruise has invested a new motorboat at $10,000 that a life of 10 years and no salvage. On the basis of today's economic environment, it is estimated that operating costs will be $500 a year revenue $2000 per year the general inflation rate will be 5% (f = 0.05) operation cost will be escalate at the same rate as general inflation a revenue will not increase with time If the rate of interest is 10% (i = 0.10), what is the Net Present Value of the investment? Is the investment viable? (NPV=-$1617 Since the NPV value is negative. The investment is NOT viable.)
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