Bob Heavy Tools is considering the acquisition of a light truck, in order to expand...
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Bob Heavy Tools is considering the acquisition of a light truck, in order to expand the business to other geographical areas. If he can expand to other areas, additional business will represents an increase in Earnings before depreciation and taxes of $70,000 annually during the first 3 years and $28,000 annually in the last 3 years. Bobs cost of capital is 12% and is in the 32.5% marginal tax rate. If the light truck cost is $190,000, What is the net present value?
DON'T MAKE INTERMEDIATE ROUNDINGS
PRESENT YOUR ANSWER ROUNDED TO ZERO DECIMAL PLACES
USE TIME VALUE FORMULAS
DON'T USE COMMA SEPARATORS
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