### Determine the exact after-tax irr for investment

##### Reference no: EM132608483

The cost of a new machine is \$110,000 and it is expected to reduce the labour cost by \$30,000 per year. The salvage value of the machine at the end of year six is expected to be \$20,000. If the after-tax MARR of the company is 9% and the tax rate is 55%:

a) Determine the exact after-tax IRR for this investment?

b) Determine the approximate after-tax IRR?

c) Should the company buy this machine?

#### Questions Cloud

 What is the amount of net cash from investing activities : JJ's Diner bought an automatic pancake maker for \$4,000, received \$1,200 for the sale of the machine, What is the amount of net cash from investing activities Satellite communication solutions : Some businesses have no alternative but to use satellite communication solutions. Evaluate the heat transfer rate through a sphere : Using Fourier's Law of heat conduction q/A = -k dT/dx, Evaluate the heat transfer rate through a sphere. What is the rate of heat transfer : What is the rate of heat transfer per unit area through a 1-cm thick stainless steel plate with inside and outside temperature of 110°c and 750c, respectively Determine the exact after-tax irr for investment : The cost of a new machine is \$110,000 and it is expected to reduce the labour cost by \$30,000 per year. The salvage value of the machine Examine specifically why you selected skills and behaviors : Based on the readings from the course text, please identify the leadership traits, skills, and behaviors that you consider the most important in leading. Production of the good : If there is a per-unit tax is placed on the production of the good? If the price of a relevant resource falls? What is money exchanged : What is money exchanged between an individual and a store fore goods or service on the circular flow chart? Calculate how many times the bacteria may be expected : Calculate how many times the bacteria may be expected to grow at the end of 18 hours - The rate of increase of bacteria in a culture is proportional

### Write a Review

#### Evaluate a null hypothesis based on analysis of data

a. State the null hypothesis. b. State the alternative hypothesis.

#### What describe the distribution of national salary

What describe the distribution of national salary among labor and capital in a competitive, profit-maximizing economy with constant returns to scale.

#### Let a firm be in long run competitive equilibrium

Let a firm be in long run competitive equilibrium. The market price will be equal to

#### Market elasticity of demand for your firms product

Based on the best available econometric estimates, the market elasticity of demand for your firms product is -2. The marginal cost of producing the product is constant at \$150, while average total cost at current production levels is \$225. Determine ..

#### Differences in elasticity of supply and elasticity of demand

Discuss the differences between elasticity of supply and elasticity of demand answering the following equations:

#### Monopolist demand curve and curve are separate

A monopolist demand curve and MR curve are separate. There are two different customers with two different elasticities but you still want to maximize profit (with MR=MC for each customer separately). A price discriminating defence monopolist manufact..

#### Is an oligopoly inevitable in the diamond industry

Is an oligopoly inevitable in the diamond industry? And what components are needed to ensure that price will remain unchanged?

#### May increase or decrease planned investment

Medical Supplies B Us (MSBU), Inc. is trying to weigh the pros and cons with respect to planned investment. The following scenarios may increase or decrease planned investment. Help MSBU, Inc. to examine each scenario to see if it immediately impacts..

#### Analyze the pros and cons of putting price ceiling

Critically analyze the pros and cons of putting a price ceiling on prescription medicine. Make sure to use concepts from the chapter in this unit such as government intervention, inefficiencies, price elasticity, etc. in your answer. In the first cas..

#### What are three key events of the twentieth century

What are three key events of the twentieth century that have shaped international relations today? Describe the events you choose and explain each of your choices.