A company plans to spend $ 165126 to install a new machine. Annual maintenance cost is $ 10831. Estimated annual income is $ 35069 starting in the first year. This revenue beglin increasing by $ 1479 per year at the end of 2d year and continue increasing through the end of 15 years. The market value of the machine is $ 20777 at the end of study period of 15 years. Determine the annual worth if the minimum attractive rate of return is 9% per year. Answer:

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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A company plans to spend $ 165126 to install a new machine. Annual maintenance cost is $ 10831. Estimated annual income is $ 35069 starting in the first year. This revenue begin increasing by $ 1479
per year at the end of 2nd year and continue increasing through the end of 15 years. The market value of the machine is $ 20777 at the end of study period of 15 years. Determine the annual worth if the
minimum attractive rate of return is 9% per year.
Answer:
Transcribed Image Text:A company plans to spend $ 165126 to install a new machine. Annual maintenance cost is $ 10831. Estimated annual income is $ 35069 starting in the first year. This revenue begin increasing by $ 1479 per year at the end of 2nd year and continue increasing through the end of 15 years. The market value of the machine is $ 20777 at the end of study period of 15 years. Determine the annual worth if the minimum attractive rate of return is 9% per year. Answer:
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