For the alternatives shown, determine the sum of the incremental cash flows for both alternatives.Мachine X Мachine YFirst Cost-35,000-90,000Annual Operating Cost -31,600-19,400Salvage Value8,000Life, Years24According to Descartes' rule and Norstrom's criterion, how many i* values in all and how many positive i* arepossible, for the cash flow (CF) sequence shown?Year123Net Cash+16,000 -32,000 - 25,000 +50,000 -8,000Flow, $Cumulative +16,000 -16,000 -41,000 +9,000 +1.000CF, $

"According to the guidelines if multiple questions are posted, only the first has to be answered. If…

For the alternatives shown, determine the sum of the incremental cash flows for both alternatives. Machine X Machine Y First Cost -35,000 -90,000 Annual Operating Cost -31,600 -19,400 Salvage Value Life, Years 0 8,000 2 4

For the alternatives shown, determine the sum of the incremental cash flows for both alternatives. Machine X Machine Y First Cost -35,000 -90,000 Annual Operating Cost -31,600 -19,400 Salvage Value Life, Years 0 8,000 2 4

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

Problem 1PS

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Question

For the alternatives shown, determine the sum of the incremental cash flows for both alternatives.
Мachine X Мachine Y
First Cost
-35,000
-90,000
Annual Operating Cost -31,600
-19,400
Salvage Value
8,000
Life, Years
2
4
According to Descartes' rule and Norstrom's criterion, how many i* values in all and how many positive i* are
possible, for the cash flow (CF) sequence shown?
Year
1
2
3
Net Cash
+16,000 -32,000 - 25,000 +50,000 -8,000
Flow, $
Cumulative +16,000 -16,000 -41,000 +9,000 +1.000
CF, $

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