Contemporary Engineering Economics 6th Edition by Chan Park

Exercise 24

You are considering purchasing a new injection-molding machine. This machine will have an estimated service life of 10 years with a negligible after-tax salvage value. Its annual net after-tax operating cash flows are estimated to be $60,000. To expect a 15% rate of return on investment, what would be the maximum amount that should be spent on purchasing the injection-molding machine