(Answered) What is the NPV of the project

Management Studies

Problem: Flatte Restaurant is considering the purchase of a $9,600 soufflé maker. The soufflé maker has an economic life of eight years and will be fully depreciated by the straight-line method. The machine will produce 1,800 soufflés per year, with each costing $2.20 to make and priced at $5.05. Assume that the discount rate is 10 percent and the tax rate is 40 percent. What is the NPV of the project?

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Question: What is the NPV of the project? Please show steps how you get an answer and please be clear in your explanation.

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Operation Management, Management Studies

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