PROBLEM TWO: Capital Budgeting The plant manager of IHK is considering the purchase of a new robotic assemble plant. The new robotic line will cost $125,000. The manager believes that the new investment will result in direct labor savings of $31,250 per year for ten years. Requirements: a. What is the payback period for this project b. What is the net present value or PV assuming a 10% rate of return? c. Should the plant manager accept or reject the project?

PROBLEM TWO: Capital Budgeting The plant manager of IHK is considering the purchase of a new robotic assemble plant. The new robotic line will cost $125,000. The manager believes that the new investment will result in direct labor savings of $31,250 per year for ten years. Requirements: a. What is the payback period for this project b. What is the net present value or PV assuming a 10% rate of return? c. Should the plant manager accept or reject the project?

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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Problem 2 please.
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