Question 1 A hospital is considering purchasing a new medical dispensing cabinet that will cost $200,000. It believes that this cabinet will reduce the number of expired medications and medical errors, resulting in a savings of $43,823 per year for the next 7 years that the machine will be used.
Question 1 A hospital is considering purchasing a new medical dispensing cabinet that will cost $200,000. It believes that this cabinet will reduce the number of expired medications and medical errors, resulting in a savings of $43,823 per year for the next 7 years that the machine will be used.
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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Pls solve all 3 parts of this question
![Question 1
A hospital is considering purchasing a new medical dispensing cabinet that will cost $200,000. It
believes that this cabinet will reduce the number of expired medications and medical errors,
resulting in a savings of $43,823 per year for the next 7 years that the machine will be used.
Question a:
In this question, we have a
investment.
O Non-simple
Simple
Question b:
What is the IRR of this investment? Round your percentage to the nearest integer. For example, if
you get 11.1%, input 11; if you get 11.8%, input 12.
Question c:
If the hospital's MARR is 8%, should they invest in this cabinet?
O No
O Yes](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2aa5be87-399a-40b3-98ac-1c02e916530c%2F162f752d-bf39-4242-b5d9-5740782b2f10%2Fdbyxzk_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Question 1
A hospital is considering purchasing a new medical dispensing cabinet that will cost $200,000. It
believes that this cabinet will reduce the number of expired medications and medical errors,
resulting in a savings of $43,823 per year for the next 7 years that the machine will be used.
Question a:
In this question, we have a
investment.
O Non-simple
Simple
Question b:
What is the IRR of this investment? Round your percentage to the nearest integer. For example, if
you get 11.1%, input 11; if you get 11.8%, input 12.
Question c:
If the hospital's MARR is 8%, should they invest in this cabinet?
O No
O Yes
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