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What is wrong with the boards logic

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Problem 1: Should an organization take a discount of 1.5/10 N/30 on a $9,000 invoice or simply pay the bill when due?

Problem 2: Community Health Center (CHC) is considering spending $50,000 on a blood analyzer. The annual cash profits from the machine will be $7,000 for each of the next 7 years of its useful life. The board of directors wants to pursue this investment, because they think the $49,000 (CHC) will receive is close to the $50,000 cost. What is wrong with the boards logic? What is the IRR on the investment?

Reference no: EM132807334

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