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unanswered not_submitted Attempts Remaining: 2 Caspian Sea Drinks is considering the purchase of a plum juicer the PJX5. There is no planned increase in production.
unanswered not_submitted Attempts Remaining: 2 Caspian Sea Drinks is considering the purchase of a plum juicer the PJX5. There is no planned increase in production. The PJX5 will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the NPV of the PJX5? a. The PJX5 will cost $1.86 million fully installed and has a 10 year life. It will be depreciated to a book value of $193,684.00 and sold for that amount in year 10. b. The Engineering Department spent 545,033.00 researching the various juicers. c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $20,505.00 d. The PJX5 will reduce operating costs by S388,098.00 per year. e. CSD's marginal tax rate is 25.00%. f. CSD is 61.00% equity-financed. 9. CSD's 18.00-year, semi-annual pay, 6.73% coupon bond sells for $960.00. h. CSD's stock currently has a market value of $24. 17 and Mr. Bensen believes the market estimates that dividends will grow at 3.26% forever. Next year's dividend is projected to be $1.60. Submit Answer format: Currency: Round to: 2 decimal places
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