How will you decide if this will be profitable

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Reference no: EM132059644

You work for a manufacturing firm and you are considering the purchase of a new CNC Milling machine. This will replace your current manual milling machine that you can sell for $25,000.

The new milling machine will cost $3XX, X00. You expect to keep it for 10 years and expect to be able to sell it for $40,000 at that time. Because of an increase in business you believe you can increase your profit by $150,000 per year.

However, you will need to hire a new operator (person) that will cost $ _____ (you decide) _____ including overhead. Upkeep will cost $5000 per year.

What term will you obtain from the equation?

How will you decide if this will be profitable?

Will it meet the criteria for the MARR hurdle?

Reference no: EM132059644

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