Vista Company Wants to Replace One of Its Older Production

question 30

Multiple Choice

Vista Company wants to replace one of its older production machines.The estimated cost is $180,000.Using a discount rate of 18%,the company calculates a net present value of the new machine to be negative $10,000.Based on this information which of the following statements is true?

• A)The use of a higher discount rate would cause the net present value to be positive.
• B)The guaranteed rate of return on the new purchase is 18%.
• C)The net present value will be positive if the actual purchase price is less than $170,000.
• D)The internal rate of return on the truck is negative.
• E)None of the answer choices is correct.

Determine project and activity timelines using project management techniques.

Analyze market share and its implications for business strategy.

Understand and apply newsvendor model calculations in a business scenario.

Understand the calculation and implications of net revenue.

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