Use the Information Below to Answer the Following Question(s)

question 2

Multiple Choice

Use the information below to answer the following question(s) .
Wet Water Company drills residential and commercial wells. The company is in the process of analyzing the purchase of a new drill. Information on the proposal is provided below:
Note: Other than the initial investment, cash flows are end of period.
-Weston Ltd. is considering investing in a new piece of equipment for its factory. It estimates that the machine will generate an additional $120,000 per year in revenues. The contribution margin on these incremental revenues is estimated at 40%. Incremental annual fixed costs are estimated to be $8,200. The equipment would have a salvage value of $14,000 at the end of 6 years. The company's required rate of return is 13%. What is the NPV of this investment if the equipment costs $250,000? (Ignore income taxes.)

• A) $2,800
• B) ($51,393)
• C) $204,803
• D) $11,768
• E) ($84,173)

Understand the reasons behind the failure of small businesses and strategies for prevention.

Grasp the concept, advantages, and disadvantages of sole proprietorships.

Comprehend the role and types of equity financing in businesses.

Analyze the impact, advantages, and disadvantages of family businesses in the economy.

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Definitions:

Social Norms

Informal understandings that govern the behavior of members within a society, defining acceptable and expected ways of acting and interacting.

Antisocial Personality Disorder

A mental health disorder characterized by a disregard for other people's rights, feelings, and societal norms, often leading to conflict with legal and social norms.

Social Interactions

The process by which individuals act and react in relation to others, which includes behaviors, communication, and understanding shared between people.

Violate

To break or fail to comply with a rule, law, or agreement.