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What the net present value of the proposed project is

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Reference no: EM132527404

The management of Penfold Corporation is considering the purchase of a machine that would cost $400,000, would last for 10 years, and would have no salvage value. The machine would reduce labor and other costs by $60,000 per year. The company requires a minimum pretax return of 13% on all investment projects.

Question 1: Determine the appropriate discount factor(s) using the tables provided.

Question 2: The net present value of the proposed project is closest to (Ignore income taxes.):

Multiple Choice

Option 1: $(74,440)

Option 2: $(34,440)

Option 3: $(134,440)

Option 4: $(399,997)

Reference no: EM132527404

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