Home Express Moving Company Is Considering Purchasing New Equipment That

question 97

Multiple Choice

Home Express Moving Company is considering purchasing new equipment that costs $728,000. Its management estimates that the equipment will generate cash inflows as follows: $$\begin{array} { | r | c | } \hline \text { Year 1 } & \$ 214,000 \\\hline 2 & 214,000 \\\hline 3 & 264,000 \\\hline 4 & 264,000 \\\hline 5 & 150,000 \\\hline\end{array}$$ Present value of $1:
$\begin{array}{|l|l|l|l|l|l|}\hline & 6 \% & 7 \% & 8 \% & 9 \% & 10 \% \\\hline 1 & 0.943 & 0.935 & 0.926 & 0.917 & 0.909 \\\hline 2 & 0.890 & 0.873 & 0.857 & 0.842 & 0.826 \\\hline 3 & 0.840 & 0.816 & 0.794 & 0.772 & 0.751 \\\hline 4 & 0.792 & 0.763 & 0.739 & 0.708 & 0.683 \\\hline 5 & 0.747 & 0.713 & 0.681 & 0.650 & 0.621 \\\hline\end{array}$ The company's annual required rate of return is 9%. Using the factors in the table, calculate the present value of the cash flows. (Round all calculations to the nearest whole dollar.)

• A) $892,000
• B) $864,646
• C) $853,320
• D) $894,000

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Essential minerals and compounds in the soil that support plant growth and health, including nitrogen, phosphorus, and potassium.

Depleted

A state of significant reduction in quantity or energy level, often referring to resources like minerals, fossil fuels, or other natural reserves that have been heavily consumed.

Aldo Leopold

An American author, philosopher, scientist, ecologist, forester, conservationist, and environmentalist, known for his book "A Sand County Almanac."

Humans

Homo sapiens, the only extant members of the hominid family, characterized by their use of language, ability to create complex tools, and establishment of social structures.