How many years must the lathe last

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Q1. A new lathe costing 60,096 will produce savings of 12,000 per year. How many years must the lathe last if an IRR of 18% was realized?

Q2. The NPV of a new product (a new brand of candy) is $6,075. The product has a life of four years and produces the following cash flows:

Year1: $15,000

Year2: $20,000

Year3: $30,000

Year4: ?

The cost of the project is three times the cash flow produced in Year 4. The discount rate is 10 percent. Find the cost of the project and the cash flow for Year 4. When required, round your answers to the nearest dollar.

Reference no: EM131629590

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