A New, More Efficient Machine Will Last Four Years and Allow

question 29

Multiple Choice

A new, more efficient machine will last four years and allow inventory levels to decrease by $100,000 during its life.At a cost of capital of 13 percent, how does the net working capital change affect the project's NPV?

• A)NPV increases by $38,668
• B)NPV increases by $61,330
• C)NPV increases by $100,000
• D)NPV increases by $138,668

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Definitions:

Diet

The combination of foods and beverages consumed by an individual, which can affect health and well-being.

Hypothalamus

A region of the brain responsible for producing hormones that control bodily functions such as temperature, hunger, and sleep.

Cerebellum

A region of the brain that plays an important role in motor control, coordination, precision, and timing.

Hippocampus

A major component of the brains of humans and other vertebrates, involved in the consolidation of information from short-term memory to long-term memory, and in spatial memory that enables navigation.