Give typing answer with explanation and conclusion A recently installed machine earns the company revenue at a continuous rate of 60,000t + 45,000 dollars per year during the firstsix months of operation and at the continuous rate of 75,000 dollars per year after the first six months. The cost of the machine is$153,000, the interest rate is 7% per year, compounded continuously, and t is time in years since the machine was installed.(a) Find the present value of the revenue earned by the machine during the first year of operation.Round your answer to the nearest integer.65022(b) Find how long it will take for the machine to pay for itself; that is, how long it will take for the present value of the revenue toequal the cost of the machine?Round your answer to two decimal places.1.69years

Present value is the equivalent today of the future cash flow based on the time and interest rate of…

Answered: A recently installed machine earns the…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section: Chapter Questions

Problem 2P

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