Westland College Has a Telephone System That Is in Poor

question 328

Multiple Choice

Westland College has a telephone system that is in poor condition. The system either can be overhauled or replaced with a new system. The following data have been gathered concerning these two alternatives (Ignore income taxes.) : Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided.Westland College uses a 10% discount rate and the total cost approach to capital budgeting analysis. Both alternatives are expected to have a useful life of eight years. The working capital would be released for use elsewhere when the project is completed.The net present value of the alternative of purchasing the new system is closest to:

• A) $(1,076,495)
• B) $(1,236,495)
• C) $(1,169,895)
• D) $(969,895)

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Definitions:

Oral Contraceptives

Medications taken by mouth to prevent pregnancy, consisting of hormones that inhibit female fertility.

Quick Start Method

A contraception initiation technique where birth control is started immediately, regardless of the menstrual cycle phase, to provide prompt contraceptive effect.

Spontaneous Abortions

Medical term for miscarriages, referring to the natural loss of a pregnancy before the fetus can survive outside the womb.

Emergency Contraception

A method of preventing pregnancy after unprotected sexual intercourse, often referred to as the "morning-after pill."