Should the investment be made or not

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Reference no: EM132207623

Question: A) You are considering making a new investment in your yoghurt factory. The investment will cost $20,000, but it will increase your annual income at a steady rate of S3,000 per year over the course of next 6 years. For an interest rate of 9%, determine if making the investment is economically viable or not.

B) Consider the same scenario depicted in section A but now instead of $3,000 per year, your income would be increasing by 10% per year compared to the previous year with the first year's income being $3,000 again. Should the investment be made or not?

Reference no: EM132207623

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