Would recommend mxm to build the plant and explain why

Reference no: EM132702654

The MXM is thinking of building a plant. The cost of building the plant is estimated at $1,000,000 and is expected to save the cost of using the third party disposal facility of $220,000 per year. The building is estimated to have a useful life of 10 years, and it will have zero disposal value. The required rate of return is 12%.

Problem 1: Compute the net present value for this investment. Would you recommend MXM to build the plant?

Reference no: EM132702654

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