Exercise 5 (10 points) Henrie's Drapery Service is investigating the purchase of a new machine...
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Exercise 5 (10 points) Henrie's Drapery Service is investigating the purchase of a new machine for cleaning and blocking drapes. The machine would cost $130,400, including freight and installation. Henrie's has estimated that the new machine would increase the company's cash inflows by $25,000 per year. The machine would have a 10-year useful life and no salvage value. Considering a minimum rate of return for the company of 11% : a. Compute the project's net present value. b. Compute the internal rate of return for the project or a narrow enough interval for it and decide whether to accept or reject the project
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