(Ignore Income Taxes in This Problem

question 1

Multiple Choice

(Ignore income taxes in this problem.) The management of Opray Corporation is considering the purchase of a machine that would cost $360,000, would last for 7 years, and would have no salvage value. The machine would reduce labor and other costs by $78,000 per year. The company requires a minimum pretax return of 11% on all investment projects.
-The net present value of the proposed project is closest to:

• A) $15,646
• B) $89,588
• C) $7,536
• D) $186,000

---

Definitions:

Harm

Physical injury, damage to health, or emotional distress caused by actions or events that negatively affect well-being.

Transactional Analysis

A psychoanalytic theory and method of therapy wherein social transactions are analyzed to determine the ego state of the communicator as a basis for understanding behavior.

Encounter

A meeting or interaction between individuals, which can lead to an exchange of ideas or affect personal growth.

Payoff

The return or reward received as a result of an investment or action.