ou have just been offered a contract worth $1.14 million per year for 6 years. However, to take the contract, you will need to purchase some new equipment. Your discount rate for this project is 11.6%. You are still negotiating the purchase price of the equipment. What is the most you can pay for the equipment and still have a positive NPV? The most you can pay for the equipment and achieve the 11.6% annual return is $______ Million. (Round to two decimal places)
ou have just been offered a contract worth $1.14 million per year for 6 years. However, to take the contract, you will need to purchase some new equipment. Your discount rate for this project is 11.6%. You are still negotiating the purchase price of the equipment. What is the most you can pay for the equipment and still have a positive NPV? The most you can pay for the equipment and achieve the 11.6% annual return is $______ Million. (Round to two decimal places)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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You have just been offered a contract worth $1.14 million per year for 6 years. However, to take the contract, you will need to purchase some new equipment. Your discount rate for this project is 11.6%. You are still negotiating the purchase price of the equipment. What is the most you can pay for the equipment and still have a positive NPV?
The most you can pay for the equipment and achieve the 11.6% annual return is $______ Million. (Round to two decimal places)
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