A paving company is considering selling their lab faciltities and outsourcing their QC (Quality Control) testing. This external testing will cost them an average of $140k per year, but the will save $45k per year in labor costs. Selling their lab facilties will generate $1m. Assuming that this decision is permamenet, is this a good idea if their MARR is 8% per year. (DRAW CASH FLOW DIAGRAM PLS)
A paving company is considering selling their lab faciltities and outsourcing their QC (Quality Control) testing. This external testing will cost them an average of $140k per year, but the will save $45k per year in labor costs. Selling their lab facilties will generate $1m. Assuming that this decision is permamenet, is this a good idea if their MARR is 8% per year. (DRAW CASH FLOW DIAGRAM PLS)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter14: Real Options
Section: Chapter Questions
Problem 3MC: Tropical Sweets is considering a project that will cost $70 million and will generate expected cash...
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A paving company is considering selling their lab faciltities and outsourcing their QC (Quality Control) testing. This external testing will cost them an average of $140k per year, but the will save $45k per year in labor costs. Selling their lab facilties will generate $1m. Assuming that this decision is permamenet, is this a good idea if their MARR is 8% per year.
(DRAW CASH FLOW DIAGRAM PLS)
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