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Your firm is contemplating the purchase of a new $1,500,000 computer-based order entry system The system will be depreciated straight-line tc zero over its five-vear
Your firm is contemplating the purchase of a new $1,500,000 computer-based order entry system The system will be depreciated straight-line tc zero over its five-vear life. It will be worth $150,000 at the end of that time. You will save $500,000 before taxes per year in order processing costs, and you will be able to reduce working capital by $700,000 (this is a one-time reduction which is lost when the project ends) If the tax rate is 24%, and the required rate of return is 15%, what is the NPV for this project
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