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You will need to break down the data and then create cash flow diagrams for both options. Now compute the Present Worth for both options
You will need to break down the data and then create cash flow diagrams for both options.
Now compute the Present Worth for both options and compare.
Please note that for the lease storage option, the lease payments are made at the beginning of each year.
(25 Pts.)3. A manufacturing company is in need of 1000 square meters of storage space for 3 years. The company is considering the purchase of land for $8,000 and erecting a temporary metal structure on it at a cost of $70 per square meter. At the end of the three year use period, the company expects to be able to sell the land for $9000 and the building for $12,000. Alternately, the company can lease storage space for $1.50 per square meter per month payable at the beginning of each year. The company's MARR is 20% per year. Using Present Worth analysis determine which type of storage space should be usedStep by Step Solution
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