Q1) Atlantic Medical Clinic can buy a new computer system which will save $7,000 annually in billing costs. Computer system will last for eight years and have no salvage value. Up to how much must Atlantic Medical Clinic be willing to pay for new computer system if clinic required rate of return is:
a. 16%
b. 20%
Q2) What lump-sum amount muts company invest now to have $500,000 available at the ending of five-year period? Suppose that company can invest money at:
a. 10%
b. 14%