Cash inflow x pvifa 1210 -750000 i dont understand how to, Ask an Expert

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Cash inflow x PVIFA (12%,10) -750,000. I don't understand how to calculate this please explains?

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A leading producer of fine cast silver jewellery is considering the purchase of new casting equipment that will allow it to expand its product line. The up-front cost of the equipment is $750,000. The company expects that the equipment will produce steady income throughout its 10-year life.

a. If One Ring requires a 9% return on its investment, what minimum yearly cash inflow will be necessary for the company to go forward with this project?

b. How would the minimum yearly cash inflow change if the company required a 12% return on its investment?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91264442

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