The pan american bottling co is considering the purchase of, Ask an Expert

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The Pan American Bottling Co. is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $60,000. The annual cash flows have the following projections:

Year 1 23,000

Year 2 26,000

Year 3 29,000

Year 4 15,000

Year 5, 8000

If the cost of capital is 13 percent, what is the net present value of selecting a new machine?

What is the internal rate of return?

Should the project be accepted? Why?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92262849

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