(Ignore Income Taxes in This Problem

question 83

Essay

(Ignore income taxes in this problem. )The management of Rosengarten Corporation is investigating the purchase of a new satellite routing system with a useful life of 7 years.The company uses a discount rate of 8% in its capital budgeting.The net present value of the investment,excluding its intangible benefits,is -$607,020.
Required:
How large would the additional cash flow per year from the intangible benefits have to be to make the investment in the automated equipment financially attractive?

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Definitions:

Social Psychologist

A professional who studies how people's thoughts, feelings, and behaviors are influenced by the actual, imagined, or implied presence of others.

Bureaucracies

Organized administrative systems governed by a set of formal rules and procedures, often employed by large organizations or governments.

Organizational Characteristics

The traits, qualities, and features that define and distinguish a specific organization, impacting its operations and effectiveness.

Max Weber

A German thinker in the fields of sociology, philosophy, and political economics whose concepts significantly impacted the study and theory of society.