A Company Can Buy a Machine That Is Expected to Have

question 50

Multiple Choice

A company can buy a machine that is expected to have a three-year life and a $30,000 salvage value. The machine will cost $1,800,000 and is expected to produce a $200,000 after-tax net income to be received at the end of each year. If a table of present values of 1 at 12% shows values of 0.8929 for one year, 0.7972 for two years, and 0.7118 for three years, what is the net present value of the cash flows from the investment, discounted at 12%?

• A) $118,855
• B) $583,676
• C) $629,788
• D) $705,391
• E) $1,918,855

Understand different entrepreneurial phases as defined by the Global Entrepreneurship Monitor (GEM) study.

Recognize the significance and impact of Corporate Social Responsibility (CSR) activities.

Identify various social entrepreneurship initiatives and their societal goals.

Acknowledge the challenges and support mechanisms for female entrepreneurs in diverse geopolitical contexts.

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Definitions:

Sequential Game

a type of strategic game in game theory where players make decisions one after another, with subsequent players having some knowledge about previous actions.

Shopkeeper

A retail merchant or owner of a small store.

Haggling Customer

A customer who actively negotiates prices with sellers, aiming to secure goods or services for less than the listed price.

Simultaneous Move Game

A strategic situation in which each player makes their decision without knowing the decisions of other players at the same time.