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An auto-part manufacturing company is considering the purchase of an industrial robot to do spot welding which is currently done by skilled labor The initial cost of the robot is

An? auto-part manufacturing company is considering the purchase of an industrial robot to do spot? welding, which is currently done by skilled labor. The initial cost of the robot is $250,000, and the annual labor savings are projected to be $125,000. If? purchased, the robot will be depreciated under MACRS as a? seven-year recovery property. This robot will be used for five years after which the firm expects to sell it for $50,000. The? company's marginal tax rate is 25% over the project period. Suppose that the project requires a $30,000 investment in working capital at the beginning of the project and the entire amount will be recovered at the end of project life. Determine the net? after-tax cash flows for each period over the project life. Assume MARR equals= 15%

Jun 02 2020 View more View Less

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