A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firm’s production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $25,089.00 per year for 8 years and costs $98,160.00. The UGA-3000 produces incremental cash flows of $27,680.00 per year for 9 years and cost $126,360.00. The firm’s WACC is 9.22%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.
A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firm’s production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $25,089.00 per year for 8 years and costs $98,160.00. The UGA-3000 produces incremental cash flows of $27,680.00 per year for 9 years and cost $126,360.00. The firm’s WACC is 9.22%. What is the equivalent annual annuity of the GSU-3300? Assume that there are no taxes.
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
Section: Chapter Questions
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A firm is must choose to buy the GSU-3300 or the UGA-3000. Both machines make the firm’s production process more efficient which in turn increases incremental cash flows. The GSU-3300 produces incremental cash flows of $25,089.00 per year for 8 years and costs $98,160.00. The UGA-3000 produces incremental cash flows of $27,680.00 per year for 9 years and cost $126,360.00. The firm’s WACC is 9.22%. What is the equivalent annual
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