Meals on Wings Inc

question 99

Multiple Choice

Meals on Wings Inc.supplies prepared meals for corporate aircraft (as opposed to public commercial airlines) ,and it needs to purchase new broilers.If the broilers are purchased,they will replace old broilers purchased 10 years ago for $105,000 and which are being depreciated on a straight line basis to a zero salvage value (15-year depreciable life) .The old broilers can be sold for $60,000.The new broilers will cost $200,000 installed and will be depreciated using MACRS over their 5-year class life;they will be sold at their book value at the end of the 5th year.The firm expects to increase its revenues by $18,000 per year if the new broilers are purchased,but cash expenses will also increase by $2,500 per year.If the firm's required rate of return is 10 percent and its tax rate is 34 percent,what is the NPV of the broilers?

• A) −$61,019
• B) $17,972
• C) $28,451
• D) −$44,553
• E) $5,021

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Definitions:

Lgn Cell

Refers to cells in the lateral geniculate nucleus, a part of the thalamus in the brain involved in processing visual information.

V1 Cell

Neurons located in the primary visual cortex (V1) responsible for processing visual information.

Retinal Ganglion Cells

Retinal neurons that accept visual data from photoreceptors and relay it to the brain.

Tectopulvinar Pathway

A visual processing pathway in the brain, connecting the superior colliculus with the pulvinar nucleus of the thalamus, involved in orienting the eyes towards stimuli.