Evaluate the present value of the new chip

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Quick computing currently sells 10 million computer chips at $20 per chip. It is about to introduce a new chip and it forecasts annual sales of 12 million of these improved chips at a price of 25$ each. However, the demand for old chips will decrease or fall to 3 mill per year. The old chips costs $6 each to manufacture and the new ones cost 8$ each. What is the proper cash flow to evaluate the present value of the new chip?

Reference no: EM133114665

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