Calculate the net present value

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Question - Vesuvias Corp. is considering buying a coating machine, which will protect paint on new cars. Here are facts about the machine's cash flows and costs that the company is considering:

Uneven Net Cash Flows: $15,000 in year one; $12,000 in year two; and $5,000 in year three.

Initial investment: $20,000

Present Value of 1 at 8% Table Value .9259 Year 1; .8573 Year 2; .7938 Year 3

Calculate the Net Present Value and make a recommendation about whether the investment should be made. The recommendation should be at least one sentence and explain anything Vesuvias Corp. should consider.

Reference no: EM133187755

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