Correct only pls. Only the highlighted parts. Npv if pretax cost savings are $100000 per year is -121277. 58. Now how to find the last part. Your firm is contemplating the purchase of a new $535,000 computer-based order entrysystem. The system will be depreciated straight-line to zero over its five-year life. It willbe worth $30,000 at the end of that time. You will be able to reduce working capital by$60,000 (this is a one-time reduction). The tax rate is 24 percent and the required returnon the project is 11 percent.If the pretax cost savings are $150,000 per year, what is the NPV of this project? (Anegative answer should be indicated by a minus sign. Do not round intermediatecalculations and round your answer to 2 decimal places, e.g., 32.16.)NPVWill you accept or reject the project?○ AcceptRejectIf the pretax cost savings are $100,000 per year, what is the NPV of this project? (Anegative answer should be indicated by a minus sign. Do not round intermediatecalculations and round your answer to 2 decimal places, e.g., 32.16.)NPVWill you accept or reject the project? Will you accept or reject the project?O AcceptO RejectIf the pretax cost savings are $100,000 per year, what is the NPV of this project? (Anegative answer should be indicated by a minus sign. Do not round intermediatecalculations and round your answer to 2 decimal places, e.g., 32.16.)NPVWill you accept or reject the project?RejectAcceptAt what level of pretax cost savings would you be indifferent between accepting theproject and not accepting it? (Do not round intermediate calculations and round youranswer to 2 decimal places, e.g., 32.16.)Cost savings

Before making an investment, the companies will analyse the benefit and profit that can be obtained…

the pretax cost savings are $100,000 per year, what is the NPV of this project? egative answer should be indicated by a minus sign. Do not round intermedia alculations and round your answer to 2 decimal places, e.g., 32.16.) NPV Will you accept or reject the project? O Reject

the pretax cost savings are $100,000 per year, what is the NPV of this project? egative answer should be indicated by a minus sign. Do not round intermedia alculations and round your answer to 2 decimal places, e.g., 32.16.) NPV Will you accept or reject the project? O Reject

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Correct only pls. Only the highlighted parts. Npv if pretax cost savings are $100000 per year is -121277. 58. Now how to find the last part.

Your firm is contemplating the purchase of a new $535,000 computer-based order entry
system. The system will be depreciated straight-line to zero over its five-year life. It will
be worth $30,000 at the end of that time. You will be able to reduce working capital by
$60,000 (this is a one-time reduction). The tax rate is 24 percent and the required return
on the project is 11 percent.
If the pretax cost savings are $150,000 per year, what is the NPV of this project? (A
negative answer should be indicated by a minus sign. Do not round intermediate
calculations and round your answer to 2 decimal places, e.g., 32.16.)
NPV
Will you accept or reject the project?
○ Accept
Reject
If the pretax cost savings are $100,000 per year, what is the NPV of this project? (A
negative answer should be indicated by a minus sign. Do not round intermediate
calculations and round your answer to 2 decimal places, e.g., 32.16.)
NPV
Will you accept or reject the project?

Will you accept or reject the project?
O Accept
O Reject
If the pretax cost savings are $100,000 per year, what is the NPV of this project? (A
negative answer should be indicated by a minus sign. Do not round intermediate
calculations and round your answer to 2 decimal places, e.g., 32.16.)
NPV
Will you accept or reject the project?
Reject
Accept
At what level of pretax cost savings would you be indifferent between accepting the
project and not accepting it? (Do not round intermediate calculations and round your
answer to 2 decimal places, e.g., 32.16.)
Cost savings

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