The management of Elamin Corporation is considering the purchase of a machine that would cost $365,695 and would have a useful life of 9 years. The machine would have no salvage value. The machine would reduce labor and other operating costs by $61,000 per year. The internal rate of return on the investment in the new machine is closest to (Ignore income taxes.):See separate Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.
A. 10%
B. 12%
C. 9%
D. 11%
Answer: C
You might also like to view...
Revel Inc., a cell phone manufacturer, launched its new range of smartphones that could only be purchased on the company's official Web site and not at retail outlets. This limitation may be attributed to the__________element of Revel's marketing mix
Fill in the blanks with correct word.
The stronger the collective impact of competitive pressures associated with the five competitive forces,
A. the stronger are the industry's driving forces. B. the fewer companies that can achieve a competitive advantage via anything other than being the industry's low-cost leader. C. the greater number of companies that can achieve a competitive advantage via differentiation. D. the greater the number of industry key success factors. E. the larger the number of competitive advantage opportunities for industry members.
From a consumer's viewpoint, localization offers
A) safety. B) convenience. C) increased productivity. D) all of the above.
Which of the following, if true, strengthens the case that determining the return on owners' equity ratio would be helpful to Matheson?
A) Matheson wants to know how profitable its business is overall. B) Matheson wants to know how well it is performing for its stockholders. C) Matheson wants to know how efficiently it is using its assets. D) Matheson wants to know the extent to which it uses debt to finance operations. E) Matheson wants to know how well it is using its inventory.