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The Zero Machine Company Is Evaluating a Capital Expenditure Proposal

question 138

Essay

The Zero Machine Company is evaluating a capital expenditure proposal that requires an initial
investment of $20,960 and has predicted cash inflows of $5,000 per year for 10 years.It will have no
salvage value.Required:
a.Using a required rate of return of 16%, determine the net present value of the investment proposal.
b.Determine the proposals internal rate of return.


Definitions:

Epithelial

Relating to the epithelium, a layer of cells covering the body surfaces, lining cavities, and forming glands.

Electrical Messages

Signals or impulses transmitted by neurons in the nervous system, enabling communication between different parts of the body.

Nervous

Pertaining to the nerves or experiencing feelings of anxiety or apprehension.

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