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Year 0 1 2 3 4 Initial cost 90,000 Cash Flow 20 16,000 28,000 48,000 40,000 Accounting Income (28,000) 21,000 19,000 18,000 The company requires
Year 0 1 2 3 4 Initial cost 90,000 Cash Flow 20 16,000 28,000 48,000 40,000 Accounting Income (28,000) 21,000 19,000 18,000 The company requires a 12% return and uses straight line depreciation for this asset with a four year useful life. They have a 3-year cut-off for payback decisions and use 20% for AAR decisions. 1) Compute the NPV and recommend action
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