Purchasing new numerically controlled lathe

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A company is interested in purchasing a new numerically controlled lathe. This lathe will reduce the time to manufacture the parts currently being produced on a conventional lathe and save $8,000 per year in labor. The new lathe will cost $25,000 and will be worth $5,000 at the end of five years. What is the simple payback period?

Reference no: EM131173878

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