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

question 75

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.
-Upper Darby Park Department is considering a new capital investment. The following information is available on the investment. The cost of the machine will be $150,000. The annual cost savings if the new machine is acquired will be $40,000. The machine will have a 5-year life, at which time the terminal disposal value is expected to be $20,000. Upper Darby Park Department is assuming no tax consequences. If Upper Darby Park Department has a required rate of return of 10%, which of the following is closest to the present value of the project?

• A) $1,632
• B) $12,418
• C) $14,050
• D) $150,000
• E) $70,000

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Definitions:

Cognitive Therapy

A form of psychotherapy focused on changing negative patterns of thought to improve emotional well-being and behavior.

Group Therapy

A form of psychotherapy where multiple individuals share and work on their issues in a guided group setting, fostering support and understanding.

Social Skills

Abilities necessary for effective interpersonal behaviors and communication, such as empathy, cooperation, and conflict resolution.

Social Behaviors

Actions or reactions of an individual in response to the social environment or interactions with other individuals.