The net investment calculation for an asset replacement decision normally includes any ____.
A) after-tax salvage value of the old asset
B) increase in net working capital
C) installed asset costs
D) All of these are correct

Question

Quizplus · Accepted Answer

The net investment calculation for an asset replacement decision should take into account all relevant costs and benefits, including the after-tax salvage value of the old asset, any increase in net working capital required for the replacement asset, and the installed asset costs. Therefore, all of these options are correct and should be included in the net investment calculation.

The Net Investment Calculation for an Asset Replacement Decision Normally