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NPV for varying costs of capital Dane Cosmetics is evaluating a new fragrancemixing machine The machine requires an initial investment of 24000 and will generate after tax cash inflows of 5000

NPV for varying costs of capital Dane Cosmetics is evaluating a new fragrancemixing machine. The machine requires an initial investment of $24,000 and will generate after-tax cash inflows of $5,000 per year for 8 years. For each of the costs of capital listed, (1) calculate the net present value (NPV), (2) indicate whether to accept or reject the machine, and (3) explain your decision.
a. The cost of capital is 10%.
b. The cost of capital is 12%.
c. The cost of capital is 14%.

Jun 03 2021 View more View Less

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