Jones Company Is Considering the Purchase of a New Machine

question 28

Multiple Choice

Jones Company is considering the purchase of a new machine for $57,000. The machine would generate an annual cash flow of $17,411 for 5 years. At the end of five years, the machine would have no salvage value. The company's cost of capital is 12%. The company uses straight-line depreciation. What is the internal rate of return for the machine rounded to the nearest percent?

• A) 12%
• B) 18%
• C) 14%
• D) 16%

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Definitions:

Immobility

The inability to move freely, often resulting in muscle weakness and other health complications.

Sitting Position

A bodily posture where an individual rests on their buttocks with the torso upright, commonly adopted for working, eating, and socializing.

Mobilization

The process of making someone or something movable or capable of movement, in medical terms often referring to physical therapy practices to increase mobility.

Joint Motion

Involves the range of movement available at a joint, including its flexibility and ability to perform various physical tasks.