net cash inflow

timer Asked: Oct 16th, 2018
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Question Description

Net Present Value Analysis. Architect Services, Inc., would like to purchase a blueprint machine for $50,000. The machine is expected to have a life of 4 years, and a salvage value of $10,000. Annual maintenance costs will total $14,000. Annual savings are predicted to be $30,000. The company’s required rate of return is 11 percent.

a. Ignoring the time value of money, calculate the net cash inflow or outflow resulting from this investment opportunity.
b. Find the net present value of this investment using the format presented in Figure 8.2.
c. Should the company purchase the blueprint machine? Explain.

Tutor Answer

School: UC Berkeley


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Net Cash Inflow and Net Present Value Calculations

Net Cash Inflow/Outflow
This is an even cash inflow and it is comput...

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awesome work thanks

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