ECNS 202 PRINTOUT
8th Edition
ISBN: 9781337096584
Author: Mankiw
Publisher: CENGAGE L
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Chapter 11, Problem 4QR
To determine
Calculating the real increase in price.
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Evaluate machine XYZ when MARR is 12% per year. Pertinent data are as follows:
Machine XYZ
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Expected life
Market (salvage) value
Annual revenue
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$10,000
5 years
$1,000
$8,000
$4,000
How much is the excess of the cash flow using the Annual Worth Method? Blank 1
Calculate the External Rate of Return. Blank 2
Compute the payback period of the investment. Blank 3
Would you recommend this investment? Explain briefly. Blank 4
Please make sure to answer each step and show work. Thank you!
Please make sure to answer each step and show work. Thank you!
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