Considering investing in two alternative production systems

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Reference no: EM131447677

Blanda Incorporated management is considering investing in two alternative production systems. The systems are mutually exclusive, and the cost of the new equipment and the resulting cash flows are shown in the accompanying table. If the firm uses a 8 percent discount rate for their production systems. (Enter negative amounts using negative sign, e.g. -45.25. Round answers to 2 decimal places, e.g. 15.25.) Year System 1 System 2 0 -$14,900 -$43,500 1 14,900 32,300 2 14,900 32,300 3 14,900 32,300 Calculate NPV. NPV of System 1 is $ and NPV of System 2 is $ Which system should the firm invest?

Reference no: EM131447677

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