You Are Considering Investing $600,000 in a New Automated Inventory

question 31

Multiple Choice

You are considering investing $600,000 in a new automated inventory system that will provide after-tax cost savings of $50,000 next year.These cost savings are expected to grow at the same rate as sales.If sales are expected to grow at 5% per year and your cost of capital is 10%,then what is the NPV of the automated inventory system?

• A)$400,000
• B)$500,000
• C)-$100,000
• D)$1,000,000

---

Definitions:

Networking Logic

Describes the principles or rationale driving the formation, expansion, and functioning of networks, particularly in social, technological, or economic contexts.

Integrated System

A cohesive system in which various components work together effectively to achieve a common goal or function.

Political Subgroups

Smaller, distinct groups within a larger political entity, often with specific interests or ideologies.

Reflexive

Involves the capability of an agent to recognize forces of socialization and alter their place in the social structure.