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Westwood Chemicals is evaluating a new chemical mixer. The current mixer can be sold for $30,000. The new mixer costs $250,000 and requires $50,000 in

Westwood Chemicals is evaluating a new chemical mixer. The current mixer can be sold for $30,000. The new mixer costs $250,000 and requires $50,000 in additional working capital. It will generate $85,000 in annual cash inflows over five years and has no salvage value.

  • Calculate the NPV with a required return of 9%.
  • Recommend if the mixer should be acquired.

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