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You can purchase an optical scanner today for $530. The scanner provides benefits worth $80 a year. The expected life of the scanner is 10
You can purchase an optical scanner today for $530. The scanner provides benefits worth $80 a year. The expected life of the scanner is 10 years. Scanners are expected to decrease in price by 30% per year. Suppose the discount rate is 10%. When is the best time to purchase the scanner?
NPV is maximized when you wait _____ years to purchase the scanner. At this date NPV will be equivalent to $______today.
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