The School District is considering the purchase of two school buses. At present, school children are transported to and from the schools in the area using private bus drivers. The new school buses will cost US$54,530 and will have a useful life of 11 years. They will have negligible scrap value, which can be ignored. The new school buses would be more cost-effective, resulting in labor savings of $10,000 per year. What are the Factor of the Internal Rate of Return, and the discount factor (%) that will give a Net Present Value of 0?

The School District is considering the purchase of two school buses. At present, school children are transported to and from the schools in the area using private bus drivers. The new school buses will cost US$54,530 and will have a useful life of 11 years. They will have negligible scrap value, which can be ignored. The new school buses would be more cost-effective, resulting in labor savings of $10,000 per year. What are the Factor of the Internal Rate of Return, and the discount factor (%) that will give a Net Present Value of 0?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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