Equipment is expected to generate cash flows

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Dobson Contractors is considering buying equipment at a cost of $72,000. The equipment is expected to generate cash flows of $15,400 per year for nine years and can be sold at the end of nine years for $5,700. The discount rate is 11%. Assume the equipment would be paid for on the first day of year one, but that all other cash flows occur at the end of the year. Ignore income tax considerations.

Reference no: EM13825326

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Equipment is expected to generate cash flows : Dobson Contractors is considering buying equipment at a cost of $72,000. The equipment is expected to generate cash flows of $15,400 per year for nine years and can be sold at the end of nine years for $5,700. The discount rate is 11%. Assume the equ..

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