Justify buying the heat exchanger unit

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Reference no: EM131806967

A firm is about to begin pilot plant operation, and it could add an optional heat exchanger unit. A unit is now available for $30,000, and it is estimated that the heat exchanger unit will be worth $35,000 after 8 years for use in other company operations. This high salvage value is because the $30,000 purchase price is really a rare bargain. If 15% is an appropriate rate of return, what annual benefit is needed to justify buying the heat exchanger unit?

Reference no: EM131806967

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