A manufacturer buys a machinery for £56444 and places it in production in exactly 3 quarter-years from the time of purchase. Once in production, it can generate a net income payable continuously at the rate of £4028 per quarter-year for the first 8 years and of £17941 per year for the remaining 5 years until it is sold for £6267. Assuming an effective rate of interest of 1.2% per quarter-year is applicable for the entire period, calculate the net present value of the project in £s (correct answer=102757.62, using formulas no tables)
A manufacturer buys a machinery for £56444 and places it in production in exactly 3 quarter-years from the time of purchase. Once in production, it can generate a net income payable continuously at the rate of £4028 per quarter-year for the first 8 years and of £17941 per year for the remaining 5 years until it is sold for £6267. Assuming an effective rate of interest of 1.2% per quarter-year is applicable for the entire period, calculate the net present value of the project in £s (correct answer=102757.62, using formulas no tables)
Algebra and Trigonometry (6th Edition)
6th Edition
ISBN:9780134463216
Author:Robert F. Blitzer
Publisher:Robert F. Blitzer
ChapterP: Prerequisites: Fundamental Concepts Of Algebra
Section: Chapter Questions
Problem 1MCCP: In Exercises 1-25, simplify the given expression or perform the indicated operation (and simplify,...
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A manufacturer buys a machinery for £56444 and places it in production in exactly 3 quarter-years from the time of purchase. Once in production, it can generate a net income payable continuously at the rate of £4028 per quarter-year for the first 8 years and of £17941 per year for the remaining 5 years until it is sold for £6267.
Assuming an effective rate of interest of 1.2% per quarter-year is applicable for the entire period, calculate the net present value of the project in £s (correct answer=102757.62, using formulas no tables)
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