Compute net present value of project

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The Acu Punct Corporation is considering the purchase of a new machine with an initial outlay of $4,500 and expected cash flows in years 1-4 of $2,200. The certainty equivalent coefficient for each period is 0.87. The appropriate discount rate for the firm is 12%, and the risk-free rate is 5%. Compute the Net Present Value of this project using the certainty equivalent approach.

Reference no: EM131178277

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