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Determine the machine net present value

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Question - Cullumber Manufacturing is considering the purchase of new computerized equipment. The machine costs $63000 and would generate $18480 in annual cost savings over its 5-year life. At the end of 5 years, the equipment would have a $4200 salvage value. Cullumber's required rate of return is 16%.

Required - Using the present value tables, determine the machine's net present value?

a. $-2491.

b. $445.

c. $60509.

d. $-491.

Reference no: EM133066889

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