Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a...
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Geary Machine Shop is considering a fouryear project to improve its production efficiency. Buying a new machine press for $ is estimated to result in $ in annual pretax cost savings. The press will be depreciated straightline to zero $ per year and it will have a salvage value at the end of the project of $ The press also requires an initial investment in spare parts inventory of $ along with an additional $ in inventory for each succeeding year of the project. If the shops tax rate is and its discount rate is what is the NPV of this project? Express your answer in dollars and cents.
Geary Machine Shop is considering a fouryear project to improve its production efficiency. Buying a new machine press for $ is estimated to result in $ in annual pretax cost savings. The press will be depreciated straightline to zero $ per year and it will have a salvage value at the end of the project of $ The press also requires an initial investment in spare parts inventory of $ along with an additional $ in inventory for each succeeding year of the project. If the shops tax rate is and its discount rate is what is the NPV of this project?
Express your answer in dollars and cents.
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