Should the firm make this investment if it requires minimum

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Reference no: EM131111320

Your firm has the option of making an investment in new software that will cost $130,000 today and is estimated to provide the savings shown in the following table over its 5-year life:

Year Savings estimate

1 ........... $35,000

2 ........... 50,000

3 ........... 45,000

4 ........... 25,000

5 ........... 15,000

Should the firm make this investment if it requires a minimum annual return of 9% on all investments?

Reference no: EM131111320

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