Microeconomics
Microeconomics
11th Edition
ISBN: 9781260507140
Author: David C. Colander
Publisher: McGraw Hill Education
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Chapter 4, Problem 15QE
To determine

Effect of flood in the price of bottled water.

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Evaluate machine XYZ when MARR is 12% per year. Pertinent data are as follows:   Machine XYZ Investment cost Expected life Market (salvage) value Annual revenue Annual expenses $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
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