OptiLux is considering investing in an automated manufacturing system. The system requires an initial
investment of $ million, has a year life, and will have zero salvage value. If the system is implemented,
the company will save $ per year in direct labor costs. The company requires a return from its
investments. PV of $ FV of $ PVA of $ and FVA of $
Note: Use appropriate factors from the tables provided.
a Compute the proposed investment's net present value.
b Using the answer from part a is the investment's internal rate of return higher or lower than Hint: It
is not necessary to compute IRR to answer this question.
Complete this question by entering your answers in the tabs below.
Required
Required B
Compute the proposed investment's net present value.
Net present value
