What would be the maximum amount for the machine

Reference no: EM132012577

Question: 1. You are considering a CNC machine. This machine will have an estimated service life of 10 years with a salvage value of 10% of the investment cost. Its annual net revenues are estimated to be $50,000. To expect a 20% rate of return on investment, what would be the maximum amount that you are willing to pay for the machine? (Ignore any tax consideration.)

$213,065

$209,624

$249,998

$276,860

2. What annual investment is required at 8% per year compounded annually to accumulate to $100,000 at the end of 20 years?

$1800

$2100

$2185

$5200

Reference no: EM132012577

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