​Use the Following Setup for Question

question 75

Multiple Choice

​Use the following setup for question
A cloth manufacturing firm is deciding whether or not to invest in new machinery.The machinery costs $45,000 and is expected to increase cash flows in the first year by $25,000 and in the second year by $30,000.The firm's current fixed costs are $9,000 and current marginal cost are $15.The firm currently charges $18 per unit.
-​If the interest is 5%,should the firm undertake the investment?

• A)​Yes,since NPV=0
• B)Yes,since NPV<0
• C)Yes,since NPV>0
• D)​No,since NPV=0

---

Definitions:

Synchondrosis

A type of cartilaginous joint where bones are joined by hyaline cartilage, allowing for bone growth or slight movement.

Gomphosis

A gomphosis is a type of fibrous joint that anchors a tooth to its socket in the jawbone.

Growing Long Bone

Refers to the process of lengthening in bones of the skeleton during childhood and adolescence through the activity at growth plates.

Arm

A limb on the human body extending from the shoulder to the wrist, enabling a wide range of motion and dexterity.