Justice Enterprises Is Evaluating the Purchase of a New Computer

question 177

Multiple Choice

Justice Enterprises is evaluating the purchase of a new computer network system. The new system would cost $24,000 and have a useful life of 5years. At the end of the system's life, it would have a residual value of $2000. Annual operating cost savings from the new system would be $8500 per year for each of the five years of its life. Justice Enterprises has a minimum required rate of return of 12% on all new projects. The net present value of the new network system would be closest to: (Round any intermediary calculations and your final answer to the nearest dollar.) Present Value of $1
Present Value of Annuity of $1

• A)$5509.
• B)$7777.
• C)$6643.
• D)$31,777.

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Definitions:

CIA

The Central Intelligence Agency, a civilian foreign intelligence service of the federal government of the United States tasked with gathering, processing, and analyzing national security information.

Relationship

The way in which two or more concepts, objects, or people are connected, or the state of being connected.

Truman Administration

The presidency of Harry S. Truman, the 33rd President of the United States, serving from 1945 to 1953, notable for its Cold War policies and the decision to use atomic bombs against Japan.

World Problems

Global issues affecting nations and peoples across the world, such as climate change, poverty, conflict, and disease.