A Machine Will Cost $28 000

question 105

Multiple Choice

A machine will cost $28 000. It is estimated that it will generate $8000 in after-tax savings each year during its five-year life. What is the profitability index assuming a hurdle rate of 10 per cent?

• A) 1.08
• B) 0.92
• C) 1.24
• D) 1.43

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Definitions:

Slander

A form of defamation achieved through spoken statements that damage a person's reputation.

Defamatory Statement

A false statement that injures someone's reputation.

Tort

A wrongful act in the civil realm that results in damages or harm to an individual, establishing legal accountability for the one committing the act.

Tort

A wrongful act or an infringement of a right (other than under contract) leading to legal liability.