The coal deposit that your firm is mining is becoming less, Ask an Expert

Economics

The coal deposit that your firm is mining is becoming less profitable every year. Profit for the next year is estimated to be $2.2M, with an expected drop of $300K per year. The firm will stop mining when it is no longer profitable. To continue operating, the firm must rebuild its dragline, which will cost $3M immediately and have no salvage value. The interest rate is 12%. What is the present worth of rebuilding the dragline?

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M92635834

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