An Increased Number of Companies Are Investing in Advanced Manufacturing

question 68

Essay

An increased number of companies are investing in advanced manufacturing systems.
Required:
A. Many proposed advanced manufacturing systems have a negative net present value when discounted-cash-flow analysis is used. Explain several causes of this situation.
B. Two major benefits of advanced systems are greater flexibility in the manufacturing process and improvements in product quality. Explain how these benefits can create problems when performing discounted-cash-flow analysis.

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Definitions:

Axis Title

A label that describes the purpose or contents of a particular axis on a graph or chart, helping to clarify the data being presented.

Data Markers

Visual symbols in charts or graphs that represent individual data points.

Vertical Axis

In charting, the y-axis along which the height of bars, points, lines, etc., represent the measured value or frequency of occurrence.

Total Row

A feature in spreadsheets and databases that automatically calculates the sum, average, or other statistical measures for a range of cells or values.